2011 ANNUAL REPORT
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
28 Mar. 2012
2011 Annual Report
PART Ⅰ IMPORTANT NOTES AND CONTENTS
Important Notes
The Board of Directors, the Supervisory Committee as well as the directors, supervisors and
senior management staff of Shenzhen Chiwan Wharf Holdings Limited (hereinafter referred
to as “the Company”) hereby confirm that there exists no misstatement, misleading
information or material omission in this report, and accept, individually and collectively, the
responsibility for the factuality, accuracy and completeness of the contents of this report.
This Annual Report has been reviewed and approved at the Third Session of the Seventh
Board of Directors of the Company. Independent director Zhang Jianjun did not attend the
meeting due to business reason and appointed Independent director Hao Zhujiang, as his
proxy to attend and speak at the meeting on his behalf. Independent director Zhang Jianjun
has given his consents to the full contents of this report.
Chairman of the Board Mr. Zheng Shaoping, Chief Financial Officer Mr. Zhang Jianguo
and Financial Manager Ms. Ma Zhihong hereby confirm that the Financial Report in the
Annual Report is true, accurate and complete.
The Annual Report is written in both English and Chinese. In case of any discrepancy
between the two versions, Chinese version prevails.
According to certain regulations issued by China Securities Regulatory Commission, the
Company needn't to prepare Financial Statements under International Financial
Reporting Standards, and thus all the financial data disclosed in this report were prepared
under Chinese Accounting Standards.
Table of Contents
PART Ⅰ IMPORTANT NOTES AND CONTENTS ................................................................................1
PART Ⅱ COMPANY PROFILE................................................................................................................2
PART Ⅲ FINANCIAL AND BUSINESS HIGHLIGHTS .........................................................................3
PART IV CHANGES IN SHARE CAPITAL AND SHAREHOLDERS....................................................4
PART V DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT STAFF & EMPLOYEES.........10
PART VI CORPORATE GOVERNANCE ...............................................................................................18
PART VII INTERNAL CONTROL ...........................................................................................................22
PART VIII GENERAL MEETING..............................................................................................................26
PART IX REPORT OF THE BOARD OF DIRECTORS.........................................................................27
PART X REPORT OF THE SUPERVISORY COMMITTEE ................................................................45
PART XI SIGNIFICANT EVENTS ..........................................................................................................46
PART XII FINANCIAL STATEMENTS (See attached) ...........................................................................53
PART XIII DOCUMENTS FOR REFERENCE..........................................................................................53
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2011 Annual Report
PART Ⅱ COMPANY PROFILE
A. Company's Name in Chinese 深圳赤湾港航股份有限公司（深赤湾）
Company's Name in English Shenzhen Chiwan Wharf Holdings Limited (Chiwan Wharf)
B. Legal Representative Mr. Zheng Shaoping, Chairman
C. Company Secretary Ms. Bu Dan
Authorized Representative Ms. Hu Jingjing
Address 13/F., Chiwan Petroleum Building, Shenzhen, PRC
Tel +86 755 26694222
Fax +86 755 26684117
E-mail cwh@cndi.com
D. Place of Registration .Chiwan, Shenzhen, PRC
Office Address 13/F., Chiwan Petroleum Building, Chiwan, Shenzhen, PRC
Postal Code 518067
E-mail Address cwh@cndi.com
Internet Website http://www.szcwh.com
E. Newspaper for Information "Securities Times" and "Ta Kung Pao"
Disclosure
Website for Annual Report http://www.cninfo.com.cn
Annual Report Preparation Secretariat of the Board of Directors
F. Stock Exchange . Shenzhen Stock Exchange
Stock Short Name Chiwan Wharf A/Chiwan Wharf B
Stock Code 000022/200022
G. Other Information
Date of Original Registration 19 Jul. 1990
Place of Registration Chiwan, Shenzhen
Business Registration Number 440301501124494
Tax Registration Number Shen-Guo-Shui-Deng-Zi No. 440300618832968
Shen-Di-Shui-Deng-Zi No. 440301618832968
Organization Code 61883296-8
Accounting Firm PricewaterhouseCoopers Zhong Tian Certified Public Accountants
Work office 35/F, Tower A, Kingkey 100, No. 5016, Shennan Road East,
Shenzhen, China
Signature of accountants Kong Yu, Yang Hua
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2011 Annual Report
PART Ⅲ FINANCIAL AND BUSINESS HIGHLIGHTS
A. Main accounting data (unit: RMB)
Increase or decrease of
2011 2010 2009
this year than last year
Revenue 1,708,136,899 1,740,417,668 -1.85% 1,465,434,512
Operating profit 816,494,626 962,439,501 -15.16% 673,649,986
Total profit 816,337,301 964,414,981 -15.35% 679,900,108
Net profit attributable to
equity holders of the 505,645,137 596,680,156 -15.26% 418,864,844
Company
Net profit attributable to
equity holders of the
505,629,810 595,310,399 -15.06% 412,521,386
Company after extraordinary
gains and losses
Net cash flows from operating
746,190,596 926,845,569 -19.49% 726,501,993
activities
Increase or decrease of
As at 31 Dec. 2011 As at 31 Dec. 2010 this year-end than last As at 31 Dec. 2009
year-end
Total assets 6,540,228,435 6,202,184,742 5.45% 5,527,873,569
Total liabilities 2,434,164,364 2,395,026,910 1.63% 2,107,282,039
Total equity attributable to
3,467,796,751 3,239,549,058 7.05% 2,852,982,756
equity holders of the Company
Share capital 644,763,730 644,763,730 0.00% 644,763,730
B. Main financial index (unit: RMB)
Increase or
2011 2010 decrease of this 2009
year than last year
Basic earnings per share 0.784 0.925 -15.24% 0.650
Diluted earnings per share 0.784 0.925 -15.24% 0.650
Basic earnings per share after
0.784 0.923 -15.06% 0.640
extraordinary gains and losses
Weighted average return on net assets 15.19% 19.70% -4.51% 15.08%
Weighted average return on net assets
15.19% 19.65% -4.46% 14.85%
after extraordinary gains and losses
Net cash flow per share arising from
1.157 1.437 -19.49% 1.127
operating activities
Increase or
decrease of this
As at 31 Dec. 2011 As at 31 Dec. 2010 As at 31 Dec. 2009
year-end than last
year-end
Net assets per share attributable to equity
5.378 5.024 7.05% 4.425
holders of the Company
Asset-liability ratio 37.22% 38.62% -1.40% 38.12%
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C. Extraordinary gains and losses
Items 2011 2010 2009
Net gains on disposal of non-current assets (1,889,222) (672,955) 8,218,321
Government grants in current year profit - 1,200,000 1,450,000
Receivables impairment reversal by individual
- - 1,815,259
assessment
Other non-operating income/ (expense), net 1,731,897 1,448,435 (3,418,198)
Tax effects 33,863 (350,605) (1,572,070)
Minority interests effects (after tax) 138,789 (255,118) (149,854)
Total 15,327 1,369,757 6,343,458
PART IV CHANGES IN SHARE CAPITAL AND SHAREHOLDERS
A. Changes in Share Capital
1. Changes in the stock of shares of the Company
Unit: share
Before the change Increase (+)/decrease (-) After the change
Issue of
Bonus Reserves
Number Percentage additional Other Subtotal Number Percentage
issue to stocks
shares
1. Shares subject to trading moratorium 673,252 0.104% 117,677 117,677 790,929 0.123%
a. State-owned shares
b. State-owned legal person shares
c. Other domestic shares
Among which:
Shares held by domestic non-state-owned
corporations
Shares held by domestic individuals
d. Shares held by overseas shareholders
Among which:
Shares held by overseas corporations
Shares held by overseas individuals
e. Shares held by senior management staff 673,252 0.104% 117,677 117,677 790,929 0.123%
2. Shares not subject to trading moratorium 644,090,478 99.896% -117,677 -117,677 643,972,801 99.877%
a. Ordinary shares denominated in RMB 464,789,805 72.087% 0 0 464,789,805 72.087%
b. Domestically listed foreign shares 179,300,673 27.809% -117,677 -117,677 179,182,996 27.790%
c. Overseas listed foreign shares
d. Others
3. Total shares 644,763,730 100% 644,763,730 100%
※ Shares held by senior executives were changed by shares mainly subject to trading moratorium
held by newly-appointed senior management.
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2011 Annual Report
2. Changes in shares subject to trading moratorium
Shares subject Increased
Shares subject
to trading Shares shares subject
Name of to trading Time of
moratorium at released in to trading Reason
shareholder moratorium at releasing
the year 2011 moratorium in
the year end
beginning 2011
Zheng Shaoping 186,018 26,529 0 159,489 January 2011
Wang Fen 61,974 0 0 61,974 January 2011
Fan Zhaoping 40,407 0 0 40,407 January 2011
Yuan Yuhui 10,530 0 0 10,530 The January 2011
Zhang Ning 134,020 23,777 0 110,243 Company January 2011
Zhao Chaoxiong 58,758 10,042 0 48,716 Law and January 2011
other
Ni Keqin 34,803 5,724 0 29,079 relevant January 2011
Qu Jiandong 0 0 84,199 84,199 laws and February 2011
Zhao Qiang 0 0 63,711 63,711 regulations February 2011
Zhang Jianguo 89,547 15,460 0 74,087 January 2011
Xiong Haiming 0 0 70,355 70,355 February 2011
Pei Jiangyuan 46,704 8,565 0 38,139 January 2011
Total 662,761 90,097 218,265 790,929
3. Issuance and listing of shares
a. The Company was approved to issue 310,470,000 ordinary shares at a par value of RMB1.00
per share in February 1993, with 224,470,000 being the promoter's shares; 46,000,000 shares
(the "A shares”) being issued to PRC investors (of which 6,000,000 shares were allotted to the
employees of the Company), and 40,000,000 shares (the "B shares”) being issued to overseas
investors. The A shares were issued at RMB3.10 per share and the B shares at RMB3.18 per
share, which were payable at HKD2.83 per share. On 5 May 1993, the Company's A and B
shares were listed and traded on Shenzhen Stock Exchange.
b. In June 1994, bonus shares were issued in a proportion of “one bonus share for every ten
shares”. On 16 June and 21 June 1994, respectively, 4,600,000 bonus A shares and 4,000,000
bonus B shares were listed and traded on Shenzhen Stock Exchange. As a result, the total
number of the Company's shares rose to 341,517,000.
c. On 22 June 1995, the Company's promoter, China Nanshan Development (Group) Inc.
(hereinafter referred to as “CND”) converted all of its 22,447,000 bonus shares to B shares,
which were sold to overseas investors at an average price of HKD3.54 per share, and then listed
and traded on Shenzhen Stock Exchange.
d. In December 1995, the Company issued 40,000,000 B shares to overseas investors at HKD2.90
per share, which were listed on Shenzhen Stock Exchange on 15 December 1995. Consequently,
the total number of the Company's shares rose to 381,517,000.
e. In June 2004, the plan about transfer of capital reserves into share capital for 2003 was carried
out on a basis of 3 shares for every 10 shares based on the total 381,517,000 shares as at the
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2011 Annual Report
close of trading on the Company’s record date (last trading day) 21 June 2004. After the
transfer, the total number of the shares of the Company was increased from 381,517,000 to
495,972,100.
f. In July 2005, the plan about transfer of capital reserves into share capital for 2004 was carried
out on a basis of 3 shares for every 10 shares based on the total 495,972,100 shares as at the
close of trading on the Company’s record date (last trading day) 5 July 2005. After the transfer,
the total number of the shares of the Company was increased from 495,972,100 to 644,763,730.
g. In May 2006, the Company implemented its share reform proposal, pursuant to which each
shareholder holding circulating A shares whose name appeared on the register kept by the
Shenzhen Branch of China Securities Depository & Clearing Corporation Limited as at the
close of trading on Shenzhen Stock Exchange on 29 May 2006 was allotted one share, paid
RMB11.5 in cash and granted eight put options by CND for every ten A Shares held
(equivalent to 2.98 shares for every ten shares held). Upon the implementation of the share
reform proposal, the shareholding percentage of CND in the Company was 57.51%.
h. 23,243,415 A shares held by CND was released for circulation on 3 July 2007.
i. 23,243,415 A shares held by CND was released for circulation on 6 June 2008.
j. 324,316,070 A shares held by CND was released for circulation on 19 June 2009.
k. The Company was approved to issue 6,000,000 Employees’ Shares at an issue price of
RMB3.10 per share in February 1993. The shares were put in trust with Shenzhen Branch of
China Securities Depository & Clearing Corporation Limited in March 1993. After bonus shares
were issued in June 1994, the number of Employees’ Shares rose to 6,600,000, among which
600,000 bonus shares were allowed to be traded on 16 June 1994. On 1 August 1994, the
Company's Employees’ Shares totaling 6,000,000 were allowed to become tradable, except
those held by the Directors, supervisors and senior management staff in accordance with
relevant rules.
B. Particulars about Shareholders
1. Number of shareholders and particulars about shares held
Total number of Total number of
38,502, with 29,466 being A-share 38,558, with 29,728 being A-share
shareholders as at 31 shareholders as at 29
holders, and 9,036 being B-share holders holders, and 8,830 being B-share holders
Dec. 2011 Feb. 2012
Shareholdings of top ten shareholders (all being shareholders holding shares not subject to trading moratorium)
Shares Type of
Shares
Percentage of subject to shares (A,
Nature of Total shares pledged or
Name of shareholders shareholding trading B, H or
shareholders held (share) frozen
(%) moratorium other
(share)
(share) shares)
CHINA NANSHAN DEVELOPMENT
57.52% 370,878,000 0 0 A shares
(GROUP) INC.
KEEN FIELD ENTERPRISES LIMITED Holder of B shares 8.02% 51,708,881 0 N/A B shares
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2011 Annual Report
CMBLSA RE FTIF TEMPLETON
Holder of B shares 7.43% 47,914,954 0 N/A B shares
ASIAN GRW FD GTI 5496
GOVERNMENT OF SINGAPORE INV.
Holder of B shares 0.94% 6,071,192 0 N/A B shares
CORP.- A/C "C"
EMPLOYEES PROVIDENT FUND Holder of B shares 0.55% 3,545,534 0 N/A B shares
OMERS ADMINISTRATION
Holder of B shares 0.5% 3,238,309 0 N/A B shares
CORPORATION(SC03)
TEMPLETON CANADA EMERGING
Holder of B shares 0.41% 2,671,924 0 N/A B shares
MKTS FUND
FTIF-TEMPLETON EMERGING MKT
Holder of B shares 0.39% 2,522,279 0 N/A B shares
SMALLER COMPANIES FUND
CHINA MERCHANTS SECURITIES
Holder of B shares 0.38% 2,470,046 0 N/A B shares
(HK) CO., LTD
TEMPLETON EMERGING MKTS
Holder of B shares 0.33% 2,126,967 0 N/A B shares
FUND INC
CND does not have any relations with other shareholders holding shares not subject to
Explanation on associated relationship among the
trading moratorium. The Company does not know if there are any inter-relations among
top ten shareholders:
other shareholders holding shares not subject to trading moratorium.
2. Information about the controlling shareholder of the Company
Company name: China Nanshan Development (Group) Incorporation
Legal representative: Fu Yuning
Registration Date: 28 September 1982
Organization code: 618832976
Business scope: Land development, port transportation and related industry, commerce,
property and tourism as well as bonded warehousing.
Registered capital: RMB900,000,000
3. Within the reporting year, the controlling shareholder of the Company remained unchanged,
while shares held by the controlling shareholder increasing to 370,878,000 shares (a stake of
57.52%) from 370,802,900 shares (a stake of 57.51%). Shares held by CND were not pledged or
frozen.
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2011 Annual Report
4. Shareholding structure of the Company
State-Owned Assets Supervision
and Administration Commission
of the State Council
100％
China Merchants State-Owned State-Owned China
Group Assets Assets National
55.14％ Supervision and Supervision and Offshore
Administration Administration Oil
Commission of Commission of Corporation
Shenzhen the People’s
China Merchants Municipal Government of
Holdings Government Guangdong
(International) Province
Company Limited
100％ 100％ 100％ 100％
China Silverflow Shenzhen Guangdong China China HK
Merchants Co., Ltd. Investment Guangye National Ocean Clifford
(Nanshan) Holdings Investment Offshore Oilfields Wong
Holdings Co., Ltd. Holdings Oil Services Investme
Ltd Limited Investme (Hong nt Co.,
nt Co., Kong) Ltd
Ltd Limited
(COOS)
36.52% 0.50% 26.10% 23.49% 7.83% 1.64% 3.92%
China Nanshan Development (Group) Incorporation
57.52%
14.58% 27.90%
Public A Shares Shenzhen Chiwan Wharf Holdings Limited Public B Shares
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2011 Annual Report
5. Shareholders of CND holding more than 5% of equity interests
Shareholder I: China Merchants Holdings (International) Company Limited
Legal representative: Fu Yuning
Date of establishment: 28 May 1991
Business scope: Investment holding and listing
Registered capital: HK$500 million
Shareholder II: Shenzhen Investment Holdings Co., Ltd.
Legal representative: Fan Mingchun
Date of establishment: 13 October 2004
Business scope: 1. Provision of guarantees to state-owned enterprises in Shenzhen;
2. Management of equity interests in state-owned enterprises other
than those directly supervised and managed by the State-owned
Assets Supervision and Administration Commission of Shenzhen;
3. Asset restructuring, transformation and capital operation of the
relevant enterprises;
4. Investment;
5. Other activities authorized by the State-owned Assets Supervision
and Administration Commission of Shenzhen.
Registered capital: RMB5.6 billion
Shareholder III: Guangdong Guangye Investment Holdings Limited
Legal representative: Zeng Ruijun
Date of establishment: 17 February 2009
Business scope: Project investment, investment management, investment consulting;
Commerce and trade information consulting.
Registered capital: RMB80,057,848
Shareholder IV: China National Offshore Oil Corporation
Legal representative: Wang Yilin
Date of establishment: 7 September 1993
Business scope: Cooperation with foreign partners for oil and gas exploitation in
China's offshore areas
Registered capital: RMB94.9 billion
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2011 Annual Report
PART V DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT STAFF &
EMPLOYEES
A. General Information
Total Amount Receiving
Shares Shares Reasons
of remuneration payments from
held at the held at the and
received from shareholding
Name Title Sex Age Term of office beginning end of the quantity
the Company units or other
of the year year for the
during the year associated
(share) (share) change
(RMB’000) units or not
Chairman
Zheng
of the Male 49 2011.5-2014.5 212,652 212,652 0 Yes
Shaoping
Board
Tian Junyan Director Male 50 2011.5-2014.5 0 0 0 Yes
Wang Fen Director Female 57 2011.5-2014.5 82,632 82,632 0 Yes
Fan Zhaoping Director Male 57 2011.5-2014.5 53,877 53,877 0 Yes
Yuan Yuhui Director Male 61 2011.5-2014.5 14,040 14,040 0 Yes
Director,
Executive
Zhang Ning Deputy Male 51 2011.5-2014.5 146,991 146,991 162.6 No
General
Manager
Independent
Li Wuzhou Male 72 2011.5-2014.5 0 0 10 No
Director
Independent
Hao Zhujiang Male 59 2011.5-2014.5 0 0 10 No
Director
Independent
Zhang Jianjun Male 47 2011.5-2014.5 0 0 10 No
Director
Chairman
of the
Yu Liming Male 49 2011.5-2014.5 0 0 0 Yes
Supervisory
Committee
Mary-Jean
Supervisor Female 55 2011.5-2014.5 0 0 0 Yes
Wong
Guo Songhua Supervisor Female 53 2011.5-2014.5 0 0 0 Yes
Zhao
Supervisor Male 46 2011.5-2014.5 64,954 64,954 91.7 No
Chaoxiong
Ni Keqin Supervisor Female 47 2011.5-2014.5 38,772 38,772 71.3 No
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2011 Annual Report
Deputy
Qu Jiandong General Male 47 2011.5-2014.5 112,265 112,265 122.3 No
Manager
Deputy
Zhao Qiang General Male 49 2011.5-2014.5 84,948 84,948 125.5 No
Manager
Deputy
General
Zhang Jianguo Male 47 2011.5-2014.5 98,782 98,782 132 No
Manager,
CFO
Deputy
General
Xiong
Manager, Male 48 2011.5-2014.5 93,807 93,807 129.9 No
Haiming
Chief
Engineer
Company
Bu Dan Female 34 2012.1-2014.5 0 0 N/A No
Secretary
Former
Han Guimao Male 61 2008.5-2011.5 13,988 13,988 0 Yes
director
Former
Pei Jiangyuan Company Female 39 2011.5-2011.12 50,852 50,852 73.6 No
Secretary
Total 1,068,560 1,068,560 938.9
Note: The total remuneration received by directors, supervisors and senior executives from the
Company in 2011 includes some medium-and long-term incentive rewards that have not yet
been paid.
B. Profiles of the Directors, Supervisors and Senior Executives
Chairman of the Board, Mr. Zheng Shaoping, graduated from Dalian Maritime Univercity with
postgraduate Diploma in International Maritime Law, and obtained MBA from University of Wales.
He was Chairman of the Board of Shenzhen Chiwan Harbour Container Co., Ltd., Deputy GM, GM
and Vice Chairman of the Board of the Company. Presently, he is Deputy GM of CND and
Executive Director of China Merchants Holdings (International) Company Limited, Vice Chairman
of China Merchants Bonded Logistics Co., Ltd. (CMBL), Chairman of the Board of Shekou
Container Terminals Ltd. and Chiwan Container Terminal Co., Ltd. (“CCT”). Director of the
Company since May 1999. GM of the Company from Sept. 2004 to Jan. 2011. He was elected as
Vice Chairman of the Company in Apr. 2010, and has been Chairman of the Board of the Company
since Jan. 2011.
Director, Mr. Tian Junyan, graduated from Huazhong University of Science and Technology, and
obtained a Master Degree in MBA. He ever took posts of lecturer, Associate Professor in school of
management in Huazhong University of Science and Technology；GM of R&D Department of
CND, and GM of Chixiao Enterprise Co., Ltd. Presently, he is GM of CND and has been Director
of the Company since May 2011.
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2011 Annual Report
Dirctor, Ms. Wang Fen, master. Previously, Chief of the GM Office, Manager of Business
Department, GM of Chiwan Warehousing Company, Assistant GM, Deputy GM and GM of CND.
Presently, Director of CND. Director of the Company since Mar. 1993. SHe was elected as Vice
Chairman of the Company in Dec. 1998 and elected as Chairman of the Company in Aug. 2000.
Due to work change, she resigned as Chairman of the Company in Jan. 2011. Now she is Director
of the Company.
Director, Mr. Fan Zhaoping, got a Bachelor’s Degree in Economics from the State’s Finance
University and a Master’s Degree in Economics from the Research Institute of Finance Ministry of
China. Previously, Manager of the Finance Department, Manager of the Financial Investment
Department and Assistant GM of CND since 1991. Now Vice President of CND. CFO of the
Company from Mar. 1993 to Sept. 1999. And Director of the Company since Apr. 1995.
Director, Mr. Yuan Yuhui, MBA. Worked in the Business Department of CND since 1989.
Previously, Chief of the GM Office and Vice President of CND. Now Vice Director of CND.
Company Secretary of the Company from Mar. 1993 to Dec. 2000. And Director of the Company
since April 1995.
Director and Executive Deputy General Manager, Mr. Zhang Ning, got a Master’s Degree in
Engineering from Wuhan University of Technology. Previously, Deputy Manager and Manager of
the Operation Department, Assistant GM and Deputy GM of CCT since Oct. 1995. Supervisor of
the Company from May 1999 to Dec. 2004. Deputy GM of the Company from Dec. 2004 to Jan.
2011. Executive Deputy GM of the Company since Jan. 2011. And Director of the Company since
May 2005.
Independent Director, Mr. Li Wuzhou, got Bachelor's Degree in Tianjin University. Previously,
Deputy Director of Construction Department, Deputy Director of Water Transportation Department
of the Ministry of Transport, Head of the Preparation Team and President of China Water
Transportation Construction Association. Currently, Senior Adviser of China Water Transportation
Construction Association, and Independent Director of the Company since May 2008.
Independent Director, Mr. Hao Zhujiang, got Bachelor's Degree in Southwest University of
Political Science and Law. Previously, Director and Secretary of Party Committee of the Bureau of
Legislative Affairs of Shenzhen Municipality, Director of the Administrative Reconsideration
Office of Shenzhen Municipal Government, Director of the Legal Advice Office of Shenzhen
Municipal Government. He retired in 2001. Currently, he is a partner and lawyer of Horizon Law
Firm, Shenzhen Office. And Independent Director of the Company since May 2008.
Independent Director, Mr. Zhang Jianjun, got Doctoral Degree in Shanghai University of
Finance and Economics. Previously, Deputy Dean and professor of the Accounting School of
Jiangxi University of Finance and Economics, Vice President of Pengyuan Credit Rating Co., Ltd.
(formerly, Sino-Hawk Credit Rating Co., Ltd.), Dean and professor of Business School of Shenzhen
University. Currently, he is the Director and a professor of Accounting & Finance Institute of
Shenzhen University. And Independent Director of the Company since May 2008.
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2011 Annual Report
Chairman of the Supervisory Committee, Mr. Yu Liming, got Doctoral Degree in Management
from Fudan University. He graduated from South China University of Technology in 1982 and
studied in Rotterdam, Netherlands and the IHE Institute, Delft from 1987 to 1988. He joined China
Merchants Group in 1984 and has extensive experiences in strategic management, asset acquisition
and business combination, port management and architecture. Currently, Chief Economist of China
Merchants Group. And Supervisor of the Company since Oct. 2009.
Supervisor, Ms. Mary-Jean Wong, is a university graduate and a member of the 10th Shandong
Committee of the Chinese People's Political Consultative Conference. Currently, Director of Lucliff
(Canada) Company and Hong Kong Fairland Resources Limited, Executive Director of HK Clifford
Wong Investment Co., Ltd. and Director of CND. And Supervisor of the Company since May 1996.
Supervisor, Ms. Guo Songhua, got a Master’s Degree from University of Manchester in U.K.
Senior Economist, Registered Financial Planner. Previously, Assistant Manager, Deputy General
Manager, Executive Deputy General Manager and General Manager of the Finance Department of
CND since 1994. Currently, Chief Financial Officer of CND. And Supervisor of the Company since
May 2008.
Supervisor, Mr. Zhao Chaoxiong, is a university graduate, Previously, Deputy Manager and
Manager of the Business Department of the Company since Dec. 1999. Currently, Deputy GM of
the Harbour Division of the Company. And Supervisor of the Company since Aug. 2009.
Supervisor, Ms. Ni Keqin, joined CCT in May 1993 and took the positions of Manager Assistant,
Deputy Manager as well as Manager of the Operation Department and GM Assistant of CCT
successively. Currently, Deputy GM of CCT. And Supervisor of the Company since May 2008.
Deputy General Manager, Mr. Qu Jiandong, graduated from The Hong Kong Polytechnic
University with a Master Degree in Shipping and Logistics. Previously, GM Assistant, Deputy GM,
Executive GM and GM of Shenzhen Chiwan Harbour Container Co., Ltd., Deputy GM of CCT and
GM Assistant of the Company. And Deputy GM of the Company since Feb. 2012.
Deputy General Manager Mr. Zhao Qiang, got a Bachelor’s Degree of Land and Chemistry from
Jilin Agricultural University. Previously, he took posts of GM of Harbour Division of the Company,
Deputy GM of Chiwan Shipping (H.K.) Company Limited and GM Assistant of the Company.
Presently, he is GM of Harbour Division of the Company and Deputy GM of Chiwan Shipping
(H.K.) Company Limited. And Deputy GM of the Company since Feb. 2012.
Deputy GM and Chief Financial Officer, Mr. Zhang Jianguo, majored in Accounting and got a
Bachelor’s Degree from Shanxi Finance & Economics Institute. Financial Manager of the Company
since Oct. 1997 and Chief Financial Officer of the Company since Sept. 1999. And Deputy GM of
the Company since Feb. 2012.
Deputy GM and Chief Engineer Mr. Xiong Haiming, graduated from South China University of
Technology with a Bachelors’ Degree of Naval Architecture Engineering. Previously, Deputy GM,
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2011 Annual Report
GM of Engineering Technology Division and GM Assistant of CCT. Presently, he is Chief
Engineer of the Company. And Deputy GM of the Company since Feb. 2012.
Company Secretary Ms. Bu Dan, got a Bachelor Degree of Accounting and a Master Degree of
Enterprise Management from Liaoning Technical University. She had been as Securities Affairs
Representative of the Company from Sept. 2003 to Aug. 2008, and Manager of Enterprise Risk
Services Department of Deloitte Touche Tohmatsu CPA Ltd. from Sept. 2008 to Oct. 2011. As
being Company Secretary of the Board since Jan. 2012.
C. Directors and Supervisors Taking Positions in CND
Name Position in the Company Position in CND Office Term in CND
Zheng Shaoping Chairman of the Board Deputy GM Jan. 2011 till present
Tian Junyan Director GM Jan. 2011 till present
Director and party
Wang Fen Director Jan. 2011 till present
secretary
Fan Zhaoping Director Deputy GM Dec. 1998 till present
Yuan Yuhui Director Vice Director Jan. 2011 till present
Mary-Jean Wong Supervisor Director Apr. 1995 till present
Guo Songhua Supervisor CFO Sept. 2007 till present
Other Positions
Name Company Position
Chiwan Container Terminal Co., Ltd. Chairman
Shenzhen Mawan Terminals Co., Ltd. Chairman
Shenzhen Mawan Port Services Co., Ltd. Chairman
Zheng
Shenzhen Mawan Wharf Co., Ltd. Chairman
Shaoping
Shekou Container Terminals Ltd. Chairman
China Merchants Bonded Logistics Co., Ltd. Vice Chairman
China Merchants Holdings (International) Company Limited Executive Director
Tian Junyan Chiwan Oriental Logistics Co., Ltd. Chairman
14
2011 Annual Report
Shenzhen Nanshan Real Estate Development Co., Ltd. Chairman
YAHGEE Modular House Co., Ltd Chairman
Chixiao Enterprise Co., Ltd. Chairman
Shenzhen Chiwan Petroleum Supply Base Co., Ltd. Director
Chiwan Wharf (Hong Kong) Limited Chairman
Dongguan Chiwan Harbour Company Limited Chairman
Wang Fen Dongguan Chiwan Wharf Company Limited Chairman
Sullair Asia Ltd. Vice Chairman
Shenzhen Pingnan Railway Co., Ltd Vice Chairman
Shenzhen Chiwan Petroleum Supply Base Co., Ltd. Chairman
Fan Zhaoping
Chiwan Container Terminal Co., Ltd. Director
Yuan Yuhui Chiwan Development (Singapore) Ltd. Director
Lucliff (Canada) Company Director
Mary-Jean
Hong Kong Fairland Resources Limited Director
Wong
HK Clifford Wong Investment Co., Ltd. Executive Director
Shenzhen Southseas Grains Industries Limited Vice Chairman
Shenzhen Nantian Oil Dregs Industry Co., Ltd. Vice Chairman
Chixiao Enterprise Co., Ltd Director
Shenzhen Haiqin Engineering. Management Co., Ltd. Director
Guo Songhua
Changsha Nanshan Real Estate Development Co., Ltd. Director
Chiwan Development (Singapore) Company Limited Director
Chiwan Development (Hong Kong) Co., Ltd. Director
Shenzhen Chiwan Petroleum Supply Base Co., Ltd. Supervisor
15
2011 Annual Report
D. Annual Salary
1. Except for Independent Directors, the Company’s other members of the Board of Directors and
the Supervisory Committee did not draw any remuneration, commission and others from the
Company for taking the position of director or supervisor of the Company. Among which,
Chairman Zheng Shaoping, Director Tian Junyan, Director Wang Fen, Director Fan Zahoping,
Director Yuan Yuhui and Supervisor Guo Songhua received their salaries from CND, while Yu
Liming, Chairman of the Supervisory Committee, and Supervisor Mary-Jean Wong drew their
salaries from shareholders of CND.
2. Allowance for Independent Directors is RMB100,000/year (tax included), which has been
approved at the 2010 Annual General Meeting with effect from 1 Jun. 2011.
3. All senior management staff of the Company are appointed by the Board of Directors. The Board
sets up the Company’s business objectives and financial budget for each year and signs KPI
contracts accordingly with senior management staff. The Board then grants rewards and
punishment to senior management staff according to their respective performance during the year.
E. Changes in Directors, Supervisors and Senior Management Staff during the reporting
period
1. Ms. Wang Fen, the former Chairman of the Board, submitted her resignation letter in Jan. 2011
and resigned from the position of the Chairman of the Board due to work change.
2. On 12 Jan. 2011, the First Special Session of the Sixth Board of Directors for 2011 was held, at
which the Report on Electing Chairman for Sixth Board of Directors, the Report on GM
Resignation and the Report on Appointing Executive Deputy GM were reviewed and approved.
Mr. Zheng Shaoping was elected as the chairman of the Board and was agreed to resign as the
GM of the Company. Mr. Zhang Ning was appointed as the executive Deputy GM, with his term
of office until May 2011.
3. On 28 Feb. 2011, the Second Special Session in 2011 of the Sixth Board of Directors was held, at
which the Report on Appointing Deputy GM of the Company was reviewed and approved. Mr.
Qu Jiandong, Mr. Zhao Qiang, Mr. Zhang Jianguo and Mr. Xiong Haiming were appointed as
Deputy GMs of the Company, with their term of office until May 2011.
4. The office terms of the Sixth Board of Directors and the Sixth Supervisory Committee as well as
senior management staff all came to expiration in May 2011.
5. The 2010 Annual General Meeting held on 27 May 2011, re-elected members for the Board of
Directors and the Supervisory Committee. At the meeting, the Report on Re-election of the Board
of Directors, the Report on Re-election of Independent Directors and the Report on Re-election
of the Supervisory Committee were reviewed and approved, electing Zheng Shaoping, Tian
Junyan, Wang Fen, Fan Zhaoping, Yuan Yuhui and Zhang Ning as directors for the Seventh
16
2011 Annual Report
Board of Directors; Li Wuzhou, Hao Zhujiang and Zhang Jianjun as independent directors for the
Seventh Board of Directors; and Yu Liming, Mary-Jean Wong and Guo Songhua as supervisors
for the Seventh Supervisory Committee. Meanwhile, the Workers’ Representative Assembly on 4
Mar. 2011 elected Mr. Zhao Chaoxiong and Ms. Ni Keqin as staff-representative supervisors for
the Seventh Supervisory Committee. The new office term of directors and supervisors mentioned
above will last till May 2014.
6. The First Session of the Seventh Board of Directors was held on 27 May 2011, electing Mr.
Zheng Shaoping as the Chairman for the Seventh Board of Directors; Mr. Zhang Ning as the
Executive Deputy General Manager; Mr. Qu Jiandong, Mr. Zhao Qiang, Mr. Zhang Jianguo and
Mr. Xiong Haiming as deputy general managers; Mr. Zhang Jianguo as CFO; and Ms. Pei
Jiangyuan as the Company Secretary for the Seventh Board of Directors. The new office term of
senior management staff mentioned above will also last till May 2014.
7. The First Session of the Seventh Supervisory Committee was held on 27 May 2011, at which Mr.
Yu Liming was elected as the Chairman for the Seventh Supervisory Committee.
8. In Dec. 2011, former Company Secretary of the Board submitted resignation to the Board of
Directors due to work change. She resigned from post of Secretary of the Board of Directors.
Then the Company held the Sixth Special Meeting of the Seventh Board of Directors for 2011, of
which reviewed and approved Proposal on Electing Secretary of the Board of Directors and
approved to engage Ms. Bu Dan as Company Secretary of the Board. Her term of office until
May 2014.
F. Work Force as at 31 December 2011
As at 31 December 2011, the Company had 1,813 employees, with 818 being university graduates,
66 financial personnel, 73 sales persons, 274 technicians, 70 management personnel, and the others
being staff for production. The Company needn’t to pay remuneration or any fees for retired staff.
Breakdown of Posts
岗位类别比列图
4% 4%
15%
66 financial personnel
4% 73 sales persons
技术人员274人
行政管理人员70人
生产人员1330人
73%
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2011 年年度报告
PART VI CORPORATE GOVERNANCE
A. Particulars about corporate governance
In strict accordance with the requirements of the PRC’s Company Law, the Securities Law,
the Corporate Governance Principle for Listed Company and the laws and regulations
issued by China Securities Regulatory Commission (“CSRC”), the Company made efforts
to improve corporate governance, promote the level of corporate governance, form modern
enterprise system and standardize corporate operation. Details about corporate governance
within the reporting period are set out as follows:
1. As for the development of corporate business and work’s concern, the Company made
amendments to Article 124 of its Articles of Association, Which were reviewed and
approved at the Seventh Session of the Sixth Board of Directors of the Company held on
25 Mar. 2011 and at the Annual General Meeting of the Company for 2010 held on 27
May 2011.
2. According to spirit of documents such as Provisions for Establishing a Registration and
Administration System for Persons with Insider Information in Listed Companies
(ZJHGG【2011】No. 30) issued by CSRC and Public Notice on Establishment of
Registration and Management System of Insiders on Inside Information (SZJGSZ
【2011】 No. 108) issued by Shenzhen SRC and Information Disclosure Business
Memo No. 34-Registration and Administration System Issues for Persons with Insider
Information, the Company revised Administration System of Inside Information and
Insiders. Such system has been reviewed and approved at the First Special Session of the
Seventh Board of Directors for 2012 held on 27 Feb. 2012.
3. According to requirements of Announcement of【2011】No. 41 issued by CSRC and
actual circumstances of the Company, the Company revised Management Rules on
Information Disclosure. The new versions has been examined and approved by the First
Special Session of the Seventh Board of Directors for 2012 held on 27 Feb. 2012.
4. In accordance with the requirements of the Notice【2011】No. 107-“Notice on Printing
and Distribution of Mr. Zhang Yundong’ Speech on Working Conference of
Governance and Practices of Shenzhen Listed Companies for 2011”, the Company
established Management System on Person in Charge of Finance and CFO. The above
system has been examined and approved on the First Special Session of the Seventh
Board of Directors for 2012 on 27 Feb. 2012.
5. Shareholders and general meeting: the Company ensures that all the shareholders,
especially minority shareholders are equal and could enjoy their full rights. The
Company called and held shareholders’ general meeting strictly in compliance with the
“Rules for Shareholders’ General Meeting”.
6. Relationship between the controlling shareholder and the Company: controlling
shareholder of the Company acted in line with rules during the reporting period, did not
18
2011 年年度报告
intervened the decisions, productions or operations of the Company directly or indirectly
in exceeding the authority of the shareholders’ general meeting, and did not appropriate
any funds of the Company.
7. Directors and the Board of Directors: the Company elected directors in strict accordance
with the Articles of Association. Number and composition of members of the Board
were in compliance with relevant laws and regulations; all Directors attended Board
meetings and general meeting in a serious and responsible manner and participated
enthusiastically relevant training so as to know better about laws and regulations as well
as the rights, obligations and liabilities of Directors. The Company set up the Audit
Committee as approved by the First Special Shareholders’ Meeting for 2004 and the
Nomination, Remuneration and Evaluation Committee and Strategy Committee of the
Board as approved by the Annual General Meeting for 2005, with a view to ensuring the
efficient operation and scientific decision-making of the Board of Directors.
8. Supervisors and the Supervisory Committee: number and composition of the members
of the Supervisory Committee were in compliance with the requirements of laws and
regulations. The supervisors diligently and seriously performed their duties and
obligations, took responsible attitudes to all shareholders and supervised the financial
affair as well as the performance by the Company’s Directors, managers and other
senior executives of their duties in compliance with the laws and regulations.
9. Stakeholders: the Company fully respected and safeguarded the legal rights and interests
of the banks and other creditors, staff, consumers and other stakeholders so as to develop
the Company in a consistent and healthy way.
10. Information disclosure and transparency: the Company authorized the Company
Secretary to take charge of information disclosure, and the Chairman as well as
related Directors to meet with shareholders. The Company disclosed relevant
information in a true, accurate, complete and timely way in strict accordance with the
requirements of laws, regulations and the Articles of Association, formulated the
“Management Rules on Information Disclosure”, the “Management System on Inside
Information and Insiders” and the “Rules on the Management of Investors Relations”,
and designated Securities Times, Ta Kung Pao and http://www.cninfo.com.cn as its
newspaper and website for information disclosure, so as to ensure all shareholders
have equal opportunity to obtain the information.
11. Corporate Governance Systems and laws that the Company already established:
“Articles of Association of the Company”, “Rules of Procedure for General Meetings”,
“Working Articles of Audit Committee of the Board of Directors”, “Working Rules of
Annual Report for Audit Committee of the Board of Directors”, “Working Articles for
Nomination, Remuneration and Evaluation Committee of the Board of Directors”,
“Working Articles of Strategy Committee of the Board of Directors”, “Working
System for Independent Directors”, “Working Rules of Annual Report for Independent
Directors”, “Rules of Procedure for Supervisory Committee”, “Working Articles of
General Manager”, “Management System for Company Shares held by Directors”,
“Supervisors and Senior Executives and Its Changes”, “Management System of
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2011 年年度报告
Foreign Investment”, “Decision-making Mechanism of Related Transactions”,
“Management System of Fund-raising”, “Management Rules on Information
Disclosure”, “Rules of Accountability for Significant Mistakes in Annual Report
Information Disclosure”, “Management System on Inside Information and Insiders”,
“Internal Audit System”, “Management System of Investors’ Relations”, “Specific
System for Engaging Accountants”, “Management Method of Financial Tools and
Management System on Person in Charge of Finance and CFO” , etc. Details for the
above systems please refer to website of the Company http://www.szcwh.com. There
isn’t difference between the actual circumstances of the Company and all established
systems.
The Company has, since its establishment, been operating in a regulated way in accordance
with the requirements of the Company Law and other laws and regulations. The Company
will keep on doing so in accordance with the “Corporate Governance Principle for Listed
Companies” so as to safeguard the interests of the shareholders and relevant stakeholders.
12. Non-compliance of corporate governance standards by the Company
As controlling shareholder of the Company CND holds 57.52% of the shares of the
Company, it is required to consolidate the Company’s financial statements in its accounts
under the Enterprise Accounting Standard No. 33-Consolidated Financial Statements.
Accordingly, CND requires the Company’s Financial Department to submit our monthly
financial statements on or about the tenth day every month for the purpose of the
preparation of its consolidated financial statements.
At the Fifth Session of the Fifth Board of Directors of the Company held on 17 April 2007,
the Report Concerning the Submission of Monthly Financial Statements to the Substantial
Shareholder was reviewed and approved, it was agreed that Financial Department shall
provide the Company’s monthly financial statements to CND. On 25 August 2007, the
Company disclosed the details of submitting the financial statements to substantial
shareholders in the Self-inspection Report and Rectification Plan for Corporate
Governance in 2007 of Shenzhen Chiwan Wharf Holding Co., Ltd. In compliance with the
requirements of the Shenzhen Securities Regulatory Bureau, the Company delivered
“Undisclosed Information Provided by the Company to its Substantial Shareholders and
Actual Controllers” to the Shenzhen Securities Regulatory Bureau before the tenth day
every month since September 2007, including the name list of relevant parties and relevant
information. The above-mentioned matters did not affect the Company’s independence. In
the future, the Company will disclose the relevant information in due course at the request
of the regulatory authorities.
13. During the reporting period, the Company didn’t receive any documents on
implementation of administrative supervision from regulatory authorities.
B. Performance of Independent Directors
The Company has three independent directors, representing one third of the total members
of the Board, which is in compliance with the requirements of the “Guiding Opinions on
Setting up Independent Director System in Listed Companies” issued by CSRC.
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2011 年年度报告
During the reporting period, attendances by the independent directors of the Company at
board sessions are as follows:
Non-
attendance
Sessions Attendance by
Attendance Attendance Absence in person
Name Title required way of
in person by proxy rate for two
to attend telecommunication
consecutive
times
Li
14 4 10 0 0 No
Wuzhou
Independent
Hao Director 14 4 10 0 0 No
Zhujiang
Zhang
14 4 10 0 0 No
Jianjun
During the reporting period, all independent directors of the Company honestly performed
their duties and brought their roles as independent directors into full play by participating
in discussions on reports reviewed at board sessions and other issues of the Company, and
proposed constructive suggestions which had been adopted by the Company. They
carefully reviewed and issued independent opinions in written form on significant events
such as material related-party transactions in accordance with relevant requirements. In
accordance with the requirements of CSRC and Shenzhen Stock Exchange, the “Working
Rules for Independent Directors” and the “Working Rules for Independent Directors
Concerning Annual Reports, they performed their obligations with due diligence and fully
oversaw the preparation and disclosure of the Annual Report of the Company for 2010.
Independent directors of the Company proactively performed their duties, monitored the
Company’s business and operation, actively protected the interests of minority
shareholders, and thus played significant roles in the scientific decision-making by the
Board of Directors. For details of performance by independent directors of their duties,
please refer to the work report of independent directors for 2011 as disclosed at
http://www.cninfo.com.cn.
C. Independence from the Controlling Shareholder
The Company is absolutely independent in business, personnel, assets, organization and
finance from its controlling shareholder. Details are set out as follows.
Controlling shareholder has handed its wharf-related business thoroughly to the Company
to operate and does not engage in the same business as the Company does, thus has no
competition with the Company.
The Company has basically separated its staff from its controlling shareholder. No senior
management staff of the Company holds positions at controlling shareholder of the
Company. No financial staff takes concurrent positions in associated companies.
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2011 年年度报告
The Company possesses its own self-governed assets and independent operation system.
Assets of the controlling shareholder in the Company (including land-use rights and fixed
assets such as property and large equipment, etc.) were converted through assets evaluation
into stock of shares at the latter half of 1992, which the Company has full rights to hold,
use and dispose of.
Management of the Company on its human resources and staff salary is absolutely
independent.
The Company has set up its own financial department as well as independent normative
accounting system and the financial management system on its subsidiaries. The Company
has its own bank accounts and does not share the same bank account with its controlling
shareholder. The Company has been paying tax in accordance with the laws and
regulations on its own behalf.
D. Performance Evaluation and Incentive Mechanism for Senior Management Staff
(see D. 3 of Part V for details)
PART VII INTERNAL CONTROL
A. Internal control improvement and self-evaluation
Based on the Basic Norms for Internal Control of Enterprises and the mating guideline, and
according to the Circular on Doing a Good Job in Pilot Internal Control Regulation in
Listed Companies of Shenzhen (Shen-Zheng-Ju-Gong-Si-Zi 〔 2011 〕 No. 31), the
Company formulated the Work Plan for Implementation of Internal Control Norms, which
was reviewed and approved at the First Special Session of the Audit Committee under the
Company’s Sixth Board of Directors for 2011 on 27 Apr. 2011 and the Fourth Special
Session of the Sixth Board of Directors for 2011. The work plan was later disclosed as
required by the regulator.
The Company set up internal control task groups by two level Management. At the lavel of
the Company, the task group was headed by the chairman of the board, with divisional
leaders and departmental leaders as the members for the internal control steering
committee, and important professionals of all functional departments as the members for
the task group. At the lavel of a subsidiary, the task group was headed by the general
manager of the subsidiary, with important professionals in the subsidiary as the members
for the task group.
According to the requirements and instructions of the CSRC and its Shenzhen bureau about
internal control in relation to financial reporting, considering its own business
characteristics and the importance, the Company determined the scope for the financial
reporting internal control for 2011 and the corresponding self-evaluation as follows: a.
Subjects included were: the Company, CCT, Shenzhen Chiwan Harbor Container Co. Ltd.
(CHCC), Shenzhen Chiwan Terminal Co., Ltd., Shenzhen Chiwan Trans-Grains Terminal
22
2011 年年度报告
Limited (SCTGT), Dongguan Chiwan Wharf Company Limited (DCW) and Dongguan
Chiwan Terminal Company Limited; b. Internal control processes included were: the
organizational structure, capital operation, procurement, asset management, marketing,
engineering projects, guarantees, outsourcing, financial reporting, the overall budget and
the information system.
According to the contents and schedule of the work plan, internal control task groups,
through examining processes, evaluating the existing process and system design and other
measures, completed the defect-looking phase for the internal control improvement project,
formulated internal control defect lists and rectification plans, and rectified internal control
problems found.
The Audit Office of the Company organized and carried out the self-evaluation of internal
control. Via talks and sampling tests, and according to the previously-set evaluation
standards, the office evaluated the defects found, prepared a defect evaluation summary
sheet, and then offered their rectification advice. It then, according to the results of its
aforesaid work, prepared the 2011 annual internal control self-evaluation report, which was
later approved by the board. For more details, please refer to the 2011 Annual Internal
Control Self-Evaluation Report of Shenzhen Chiwan Wharf Holdings Limited, disclosed
by the Company on www.cninfo.com.cn.
The Company engaged PricewaterhouseCoopers China to audit the effectiveness of its
2011 financial reporting internal control. A standard auditor’s report with unqualified
opinion was issued by PwC China and later disclosed by the Company as required by the
regulator.
B. Directors’ statement on their responsibility towards internal control
As required by the CSRC and Shenzhen Stock Exchange, the board made a statement on
the Company’s internal control self-evaluation report as follows:
The responsibility of the Board of Directors of the Company is to set up, improve and
effectively carry out internal control for financial reporting.
The objective of the financial reporting internal control is to rationally ensure the factuality,
completeness and reliability of the information carried in the financial statements, and to
prevent material misstatement. Due to the inherent limitations in internal control, and
possible influence from changes of the internal and external environment, policies, laws
and regulations, the existing internal control may no longer be applicable or may cause
different results, the financial reporting internal control can only provide rational guarantee
for the aforesaid objective.
The board has evaluated the financial reporting internal control according to the Basic
Norms for Internal Control of Enterprises and the evaluation guideline and believes that it
had no material defect on 31 Dec. 2011 (the base day).
23
2011 年年度报告
C. Financial Reporting Internal Control Audit Report issued by PricewaterhouseCoopers China
Auditors’ Report on Internal Control
PwC ZT Shen Zi (2012) No.247
To the Shareholders of Shenzhen Chiwan Wharf Holding Limited:
We have audited Shenzhen Chiwan Wharf Holdings Limited’s (the "Company") internal
control over financial reporting as of December 31, 2011, based on the requirements of the
Enterprise Internal Control Assurance Guidance, and the professional standards of Chinese
Certified Public Accountants.
1. Company responsibilities over internal controls
According to the Basic Standard for Enterprise Internal Control, Enterprise Internal
Control Practical Guidance and Enterprise Internal Control Assessment Guidance, the
Company's Board of Directors is responsible for establishing and maintaining effective
internal controls and for its assessment of the effectiveness of internal controls.
2．Auditors’ responsibilities
Our responsibilities are to express opinion on the effectiveness of the Company's internal
control over financial reporting base on our audit and to disclose any material weakness we
noted in relation to internal control over the non-financial reporting area.
3．Inherent Limitation of Internal control
Because of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of effectiveness to
future periods are subject to the risk that controls may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.
4．Opinion on the effectiveness of internal control over financial reporting
In our opinion, the Company, based on the Basic Standard for Enterprise Internal Control
and the related requirements, maintained, in all material respects, effective internal control
over financial reporting as at December 31, 2011.
Pricewaterhouse Coopers Zhongtian Certified Public Accountants
Shanghai, the People’s Republic of China
27 March 2012
D. Opinion from independent directors on the internal control self-evaluation
The Company held the Third Session of the Seventh Board of Directors on 27 Mar. 2012 to
review the 2011 Annual Internal Control Internal Control Self-evaluation Report. As the
24
2011 年年度报告
Independent Directors of the Company, we hereby give our independent opinions as
follows:
During the reporting period, the Company thoroughly and effectively improved internal
control. Key internal control activities involving controlled subsidiaries, related-party
transactions, external guarantees, use of raised funds, significant investments, information
disclosure, etc. proceeded in compliance with relevant internal control rules. The internal
control rules of the Company were in compliance with applicable laws, regulations and the
regulators’ requirements, which effectively prevented risks and ensured the normal
proceeding of the Company’s operation and management.
In overall, we believe that the 2011 Annual Internal Control Internal Control Self-
evaluation Report gives a true picture of the actual situation of the Company’s internal
control.
E. Basis for the financial reporting internal control and material internal defects of
financial reporting found within the year
Based on the Company Law, the Accounting Law, the Accounting Standards for Business
Enterprises, the Basic Norms for Internal Control of Enterprises & its mating guideline and
the Stock Listing Rules of Shenzhen Stock Exchange, as well as applicable laws,
regulations, standards and guidelines, and considering its actual situation, the Company has
formulated a comparatively sound financial reporting internal control system upon years of
improvement. The system is based on the financial management system, with relevant
management rules as the control means and the daily management system as the control
guarantee.
The financial reporting internal control system includes: the Accounting Management
Rules as the basis; the Internal Control Rules for Monetary Funds, the Internal Audit Rules,
the Approval Power and Process for Significant Matters, the Management Rules for Fixed
Assets, the Management Rules for Outward Investments, the Bidding and Bidding
Invitation Management Rules, the Overall Budget Management Rules, the Decision-
making Rules for Related-party Transactions, the Management Rules for Raised Funds, the
Accountability Mechanism for Material Errors in Annual Report Disclosure, the Special
Rules for Engaging a CPAs Firm, the Management Methods for Financial Instruments, the
Management Rules for Financial Chief and Accounting Chief and other rules, which have
been executed to effectively control the financial reporting internal control system; and the
ISO9001 Quality Management System, the ISO14001 Environmental Management System,
the ISO28000 Supply Chain Safety Management System, the safety management rules and
other daily management rules, which have formed a solid guarantee for the financial
reporting internal control system.
The Company has evaluated the internal control in relation to financial reporting according
to the Basic Norms for Internal Control of Enterprises and the mating guideline, with no
material defects found.
25
2011 年年度报告
F. Formulation and execution of the material error accountability system
Pursuant to the Securities Law, the Administrative Methods for Information Disclosure of
Listed Companies and other laws and regulations, as well as the Company’s Articles of
Association, the Company has formulated the Accountability Mechanism for Material
Errors in Annual Report Disclosure, which was reviewed and approved at the Fifth Session
of the Sixth Board of Directors on 8 Apr. 2010. During the reporting period, the Company
strictly executed the Accountability Mechanism for Material Errors in Annual Report
Disclosure, with no such cases as correction of material accounting errors, supplementation
due to material omissions or correction of performance forecasts.
G. Formulation and execution of other internal accountability mechanisms
The First Special Session of the Seventh Board of Directors of the Company for 2012 was
held on 27 Feb. 2012, at which the Management Rules for Information Disclosure, the
Management Rules for Information Insider Information & Insiders and the Management
Rules for Financial Chief and Accounting Chief were formulated and revised. Internal
accountability was added to further improve the internal accountability mechanism of the
Company. Up to the disclosure date, the Company has strictly executed the aforesaid rules.
PART VIII GENERAL MEETING
Two shareholders’ general meetings were held during the year, i.e. the Annual General
Meeting for 2010 and the First Special General Meeting for 2011.
The Annual General Meeting for 2010 was held on 27 May 2011 on 11/F, Chiwan
Petroleum Building, Shenzhen. Reports were reviewed and approved at the meeting as
follows: “2010 Annual Work Report of the Board of Directors”, “2010 Annual Work
Report of the Supervisory Committee”, “2010 Annual Final Financial Report”, “2010
Annual Profit Distribution and Dividend Report”, “Report on Re-election of the Board of
Directors”, “Report on Re-election of Independent Directors”, “Report on Allowances for
and Expenditure on Independent Directors”, “Report on Re-election of the Supervisory
Committee”, “Report on Engagement of a CPAs Firm for 2010”, “Report on Amendment
to the Company’s Articles of Association” and “Report on Adjustment of Withdrawal
Ratio for Medium and Long-term Incentive Fund”. And the announcement of the
resolutions made at the meeting was disclosed in Securities Times and Ta Kung Pao on 28
May 2011 (Announcement No.: 2011-020).
The First Special General Meeting for 2011 was held in the afternoon on 22 Sept. 2011 on
11/F, Chiwan Petroleum Building, Shenzhen. Reports were reviewed and approved at the
meeting as follows: “Report on the Corporate Bond Plan” and “Report on Motioning the
General Meeting to Give the Board of Directors Full Authority to Handle Matters Related
to the Corporate Bond Plan under Applicable Laws and Regulations”. And the
announcement of the resolutions made at the meeting was disclosed in Securities Times
and Ta Kung Pao on 23 Sept. 2011 (Announcement No.: 2011-034).
26
2011 年年度报告
PART IX REPORT OF THE BOARD OF DIRECTORS
A. Business review for the reporting period
1. Summary of business in the reporting period
The Company is principally engaged in the handling, warehousing and transportation of
containers and bulk cargoes, as well as the provision of related services.
The economy of the world in 2011 recoved hardly. The spreading European Sovereign
Debt Crisis, the Japan Earthquake, the riotous Middle East and other factors presented the
world economy with serious challenges. China’s foreign trade grew in a much lower-than-
expected rate. The overall of iner companies gave a lackluster performance, transport
capacity was integrated and deepened, and more and more large ships kept putting pressure
on facilities and equipments in ports. In the year, the Company deeply carried forward
optimization of resource allocation, stepped up its efforts and looked for overall
improvement of its resources. Meanwhile, it made good use of internal and external
opportunities to ensure stability of clients and achieve steadily increasing rates of port
operation charges. In order to upgrade its service, the Company reinforced internal
management in an all-round way covering system, process, technology, training, etc.,
carried on with research and innovation in an orderly manner and made sure of application
of research results. As a result, internal management of the Company was improved on a
going basis and notable achievements in cost control. By and large, the Company managed
to maintain or even slightly improve all of its performance indicators with a stricter cost
control.
Duing the reporting year, the Company achieved a container throughput of 5,793,000 TEU,
down 5.8% as compared with last year, pushing the Company behind the average growth
rate of 0.3% in all Shenzhen ports for the same period. The said container throughput
represented a 25.7% market share in the container & port business in Shenzhen, down 150
basic points on a year-on-year basis. Chiwan port achieved a throughput of 4,122,000 TEU,
a 1% decrease over last year.
As for its bulk cargo handling business, the Company still handled grain and fertilizers as
its two main kinds of cargo and maintained a leading position in the region in this respect.
In 2011, considering a weak market demand and decreasing available resources in Chiwan
Port, the Company adjusted the cargo source structure by increasing the portion of high-
value cargo sources. As a result, the average unit price rose considerably. Meanwhile, the
Company also adjusted retention periods to increase its income from retention charges,
which was why it still achieved growth in operating revenue and profit despite a decreasing
throughput. Throughout the year, the Company achieved a throughput of 9.251 million
tons, representing a slight decrease of 9.4% year on year. The bulk cargo throughput
achieved by Chiwan port 6.532 million tons, decreased of 18.2%, accounting for a 19.8%
market share among the three main bulk cargo wharfs in Shenzhen, down 180 basic points
over 2010.
27
2011 年年度报告
For the year 2011, the Company achieved a throughput of 63.84 million tons, representing
a slight decrease of 0.5% over 2010 and accounting for 27.4% of the overall throughput at
Shenzhen ports, down by 60 basic points as compared with 2010.
Business highlights of the Company for the past three years are set out as follows.
Business Data 2011 2010 2009
Total throughput (million tons) 63.84 64.17 51.77
Among which: Container throughput (million TEU) 5.79 6.15 4.77
Chiwan Port 4.12 4.16 3.29
Mawan Port 1.67 1.96 1.48
Machong Port 0 0.03 --
Throughput of bulk cargo (million tons) 9.25 10.21 8.18
Chiwan Port 6.53 7.99 8.18
Machong Port 2.72 2.23 --
Hours charged for tow trucks (million hours) 1.23 1.30 1.16
Hours charged for tugboats (hour) 32,121 34,447 30,219
In face of rising labor cost, raw material cost and fuel cost in 2011, the Company actively
coped with these problems through modern management and research & innovation. It
improved the system’s statistical function, monitored unit consumption of labor and man
hours, and reduced cost labor according to the appraisal system. Meanwhile, it also
explored the possibility of using domestic tugboat spare parts to reduce raw material cost.
And in order to keep down fuel cost, it altered internal tugboats in container wharfs with
LNG (liquefied natural gas). The relationship between the costs caused by all adjustments
in the year and the business volume and income was under effective control.
Year-on-year changes in revenue, operating profit and net profit attributable to the
shareholders of the Company (unit: RMB)
Items 2011 2010 +/- YoY Reason
Revenue 1,708,136,899 1,740,417,668 -2% Decreased in cargo throughput
Operating profit 816,494,626 962,439,501 -15% ① Increased in the substantial rise in prices
Net profit of various raw materials, labor cost, loan
attributable to interest and so on from a year earlier; and ②
shareholders of in the same period of last year, income from
505,645,137 596,680,156 -15%
the Company disposal of long-term investment was gained,
while there was no such kind of event in the
current period.
During the reporting period, no substantial change took place in the structures of core
business and profit breakdown.
2. Core business and performance
a. Breakdown of revenue and operating profit (unit: RMB)
28
2011 年年度报告
Operating
Core business Industry Revenue Percentage(%) Percentage
profit
Cargo handling Cargo handling 1,593,390,668 91% 809,495,898 99%
Land transportation Transportation 59,071,320 3% 12,057,173 1%
Tugboat services Related Shipping 83,312,479 5% 30,110,696 4%
Agency services and
Agency 16,176,410 1% (35,169,141) -4%
others
Subtotal 1,751,950,877 100% 816,494,626 100%
Offset among the
business segments (43,813,978)
Total 1,708,136,899 100% 816,494,626 100%
b. Indicators relating to core business which accounts for more than 10% of revenue and
operating profit (unit: RMB)
YoY +/- of YoY +/- of
Operating YoY +/- of
Business Revenue Operating cost operating Operating
profit margin revenue
cost profit margin
Cargo handling 1,593,390,668 725,779,726 54.45% -1.81% 3.45% -4.70%
Movements:
Revenue from cargo handling decreased 1.81% on a year-on-year basis, which was mainly
due to decrease in the business volume of containers and bulk cargoes.
Operating cost went up by 3.45% over last year mainly due to rising labor cost and
material prices.
3. Major customers
Revenue from the top five customers with aggregate amount of RMB913,272,542
accounted for 53% of the Group’s total revenue in 2011.
4. Financial status for the reporting period
a. Material year-on-year changes in assets composition and reasons therefore
Accounting for Accounting for
YoY
total assets as at total assets as at Reason
change
the end of 2011 the end of 2010
Increased investments and payment for
Cash at bank
7.32% 12.60% -5.28% project leads to the decrease in balance of
and on hand
cash at bank and on hand.
Extension of Berth No. 13 and the
Construction
7.92% 0.24% 7.68% projects in Marchong port are unfinished
in progress
in the current period .
29
2011 年年度报告
The balance is dividend payable to
Dividend minority interest of subsidiaries. At 31
5.58% 3.44% 2.14%
payable December 2011 ,the dividends of 2011
and 2010 are declared but not paid yet.
b. Measurement models adopted for major assets
Cost approach was adopted for measurement of the Company's assets, except for available-
for-sale financial assets for which fair value approach was adopted.
Impact on net profit
Impact on equity
Balance at the Balance at of the current period
holders’ equity
Items beginning of the end of Changes attributable to equity
attributable to the
the period the period holders of the
Company
Company
Available-for-sale
6,640,000 5,690,000 (950,000) － (767,700)
financial assets (a)
(a) Available-for-sale financial asset represented 1,000,000 PRC legal person floating
shares of Jiangsu Expressway Co., Ltd. held by the Company. As at 31 December
2011, the fair value of the said shares in Shanghai Stock Exchange per the closing
market price of the last trading day of year 2011 was RMB5,690,000.
c. Material year-on-year changes in financial data and reasons therefore
2011 2010 +/- (%) Reason
Financial Increase in both loans and loan
12,370,981 (10,535,505) 217%
cost/(income)-net interest rates
d. Breakdown of cash flows
2011 2010 +/-(%) Reason
Net cash flows from The drop of revenue and
746,190,596 926,845,569 -19%
operating activities operating profit in 2011
Net cash flows from Expenses of investment project
(709,215,303) (781,017,371) -9%
investing activities was decrease this year.
Net cash flows from more borrowings were repaied
(330,746,958) (99,147,646) 234%
financing activities in the reporting period
Effect of exchange rate
fluctuation on cash and (9,159,475) (6,056,736) 51%
cash equivalents
Net increase in cash and
(302,931,140) 40,623,816 -846%
cash equivalents
30
2011 年年度报告
e. Differences between cash flow from operating activities and net profit of the Company
for the reporting period
2011
Net profit 667,775,668
Add: Provisions for assets impairment 251,074
Depreciation of fixed assets 159,529,959
Depreciation/amortization of investment property 1,333,629
Amortization of intangible assets 38,525,927
Amortization of long-term prepaid expenses 3,389,657
Losses /(Gains) on disposal of fixed assets, intangible assets and
1,889,222
other long-term assets
Finance expenses 24,358,158
Investment income (118,228,183)
Decrease /(Increase) in deferred tax assets (7,167,257)
Increase in inventories 388,168
Decrease/(Increase) in operating receivables (44,983,485)
Increase/(decrease) in operating payables 19,128,059
Net cash flows from operating activities 746,190,596
5. Items relating to fair value measurement
Unit: RMB’000
Gains or losses
Balance at the Accumulated fair Impairment Balance at the
on fair value
Item beginning of the value changes provided in end of the
changes in the
period included in equity the period period
period
Financial assets:
Including:
1. Financial assets at fair value
through profit or loss of the
current period
Including: Derivative financial
assets
2. Available-for-sale financial
6,640 (767.70) 5,690
assets
Hedging instruments
Subtotal of financial assets 6,640 (767.70) 5,690
Financial liabilities
Investment property
Productive living assets
Total 6,640 (767.70) 5,690
31
2011 年年度报告
6. Financial assets and liabilities in foreign currency held by the Company
Unit: RMB’000
Accumulated
Gains or
Balance at the fair value Impairment Balance at the
losses on fair
Item beginning of changes provided in end of the
value changes
the period included in the period period
in the period
equity
Financial assets:
Including: 1. Financial assets at fair
value through profit or loss of the - - - - -
current period
Including: Derivative
- - - - -
financial assets
2. Loans and accounts receivable 205,841.95 - - - 217,794.17
3. Available-for-sale financial assets - - - - -
4. Hold-to-maturity investment - - - - -
Subtotal of financial assets 205,841.95 - - - 217,794.17
Financial liabilities 1,251,523.31 - - - 1,173,673.87
7. Operations and results of main controlled subsidiaries and joint ventures
a. Chiwan Container Terminal Co., Ltd.
The Company holds 55% equity interests directly and indirectly in CCT. With a registered
capital of USD95.3 million, CCT is engaged mainly in handling containers, especially in
accommodating international container lines. CCT achieved a container throughput of
3.317 million TEUs, a drop of 7.6% as compared with 2010. As at 31 December 2011,
total asset of CCT was RMB2,963,576,038 and net asset was RMB1,263,552,924.
b. Shenzhen Chiwan Harbor Container Co. Ltd.
The Company holds 100% equity interests directly and indirectly in CHCC. With a
registered capital of RMB288.2 million, CHCC is now mainly engaged in handling
containers, especially in the accommodation service for transshipment container barges for
foreign trade and for medium or small sized international liners as well. During the
reporting year, CHCC achieved a container throughput of 568,000 TEUs, an increase of
61.8% compared with 2010. As at 31 December 2011, total asset of CHCC was
RMB659,738,776 and net asset was RMB433,600,636.
c. Harbor Division
Being an independent accounting unit controlled by the Company but not an enterprise,
Harbor Division is engaged in handling and warehousing of imported fertilizers. During
the reporting period, throughput reached 2.23 million tons, 4.3% down as compared with
2010, of which throughput of bulk and general cargo reached 1.68 million tons, throughput
of empty containers reached 237,000 TEUs. As at 31 December 2011, total asset of Harbor
Division was RMB311,214,269 and net asset was RMB273,983,797.
32
2011 年年度报告
d. Shenzhen Chiwan Terminal Co., Ltd
The Company holds 100% equity interests directly and indirectly in this company. With a
registered capital of RMB50 million, the company is engaged mainly in the handling and
storage of grains. During the reporting period, the company achieved a throughput of 4.85
million tons, 20.5% down compared with 2010. As at 31 December 2011, total asset of the
company was RMB133,667,859 and net asset was RMB100,236,530.
e. Shenzhen Chiwan Trans-Grains Terminal Limited
The Company holds 100% equity interests in SCTGT directly and indirectly. With a
registered capital of RMB45 million, SCTGT is principally engaged in the loading and
unloading, warehousing and packaging of grains and provides related service for the
handling and storage of grains by Shenzhen Chiwan Terminal Co., Ltd. During the
reporting period, stacking volume of goods reached 41.37 million tons day, representing a
decrease of 9.8% compared with that of the previous period. As at 31 December 2011,
SCTGT's total asset was RMB98,837,295 and net asset was RMB61,884,143.
f. Dongguan Chiwan Wharf Company Limited (DCW)
The Company holds 85% equity interests directly and indirectly in this company. With a
registered capital of RMB450 million, the company is engaged mainly in the handling and
storage of bulk cargos. During the reporting period, the company achieved a throughput of
2.719 million tons, 12.4% up compared with 2010. As at 31 December 2011, total asset of
the company was RMB836,380,051 and net asset was RMB450,220,756.
g. Chiwan Wharf (Hong Kong) Ltd. (CWHK)
Registered in Hong Kong with a registered capital of HKD1,000,000 and as a wholly
owned subsidiary of the Company, CWHK is an investment holding company. As at 31
December 2011, total asset of CWHK was RMB1,786,640,161 and net asset was
RMB1,114,832,246. Subsidiaries of the company are as follows:
Shareholding percentage of Shareholding percentage
Company
Chiwan Wharf (Hong Kong) Ltd. of the Company
Chiwan Container Terminal Co., Ltd. 4% 51%
Shenzhen Chiwan Harbor Container Co. Ltd. 15.02% 84.98%
Shenzhen Chiwan Transportation Co., Ltd. 25% 75%
Shenzhen Chiwan Shipping & Transportation Co., Ltd. 10% 90%
Shenzhen Chiwan Trans-Grains Terminal Limited 25% 75%
Chiwan Shipping (H.K.) Company Limited 100% 0
Media Port Investments Limited 50% 0
Dongguan Chiwan Wharf Company Limited 43.55% 41.45%
Dongguan Chiwan Terminal Company Limited 75% 25%
33
2011 年年度报告
As approved by Shenzhen Stock Exchange, disclosure of revenue, operating profit and net
profit of the above-mentioned subsidiaries for the year 2011 will be consolidated. Revenue,
operating profit and net profit attributable to equity holders of the said subsidiaries for
2011 were RMB1,599,394,190, RMB758,124,597 and RMB447,642,890 respectively.
h. Shenzhen Chiwan Transportation Co., Ltd. (SCTC)
The Company holds 100% equity interests in SCTC directly and indirectly. With a
registered capital of RMB15 million, SCTC is principally engaged in tow-truck services.
During the reporting period, 1.23 million hours of tow truck operations were recorded,
representing a decrease of 5.3% compared with that of the previous period. As at 31
December 2011, SCTC's total asset was RMB65,645,763, net asset RMB33,654,004,
revenue RMB59,071,319, operating profit RMB12,057,173, and net profit RMB9,010,080
respectively.
j. Shenzhen Chiwan Shipping & Transportation Co., Ltd. (SCST)
The Company holds 100% equity interests in SCST directly and indirectly. With a
registered capital of RMB24 million, SCST specializes in provision of tugboat services.
During the reporting period, 32,121 hours were charged for tugboat services, representing a
decrease of 6.8% compared with that of the previous period. As at 31 December 2011,
SCST's total assets was RMB160,693,145, net assets RMB51,002,798, revenue
RMB83,312,479, operating profit RMB30,110,696 and net profit RMB22,814,515
respectively.
k. China Overseas Harbour Affairs (Laizhou) Co., Ltd. (COHAL)
The Company holds 40% equity interests in COHAL directly and indirectly. With a
registered capital of USD176.4077 million, COHAL specializes in handling petroleum,
liquefied products and bulk cargos. During the reporting period, this company achieved a
throughput of 14.01 million tons, representing a decrease of 2% compared with that of the
previous period. As at 31 December 2011, this company’s total assets was
RMB2,021,464,420, net assets RMB1,798,653,184, revenue RMB295,054,110, operating
profit RMB88,017,196 and net profit RMB81,662,641 respectively.
B. Outlook for the future development of the Company
1. Development trend and competition status of the industry in which the Company is
engaged
In 2012, economic recovery in American and European countries may remain faltering,
causing weak demands. Affected by that, global economy will grow in a comparatively
lower pace. China’s foreign trade still has a chance to rise, but the growth rate is sure to
become lower. Judging from the cycle of the industry, the shipping industry may have
reached the peak of this cycle in 2010, and considering bottoming freight charges and
unfavorable factors concerning the macro-economy and shipping capacity supply &
demand, it is hard for the industry to reach that peak again in 2012 even if it bottoms out in
34
2011 年年度报告
the year. The intrinsic growth of the port industry will slow down structurally. Meanwhile,
investments that have been made in the high-speed development period will continue to
produce new throughput capacity, and over-capacity in ports will heat up competition.
Shenzhen ports mainly handle containers for foreign trade, making the port industry easily
susceptible to foreign demands. And the Company’s container business lies in an area
where ports handling large containers are close-packed, which means fierce competition.
Slowdown of growth in foreign trade and further relocation of industries from the Pearl
River Delta will both affect growth of container capacity in the future. At the same time,
liner companies are having low freight charges and a poor performance, which will
consequently put pressure on port tariffs.
Alteration in ports in West Shenzhen will be carried forward step by step. The bulk cargo
handling business developed by the three ports in the western part of Shenzhen in line with
their respective strengths will remain stable generally, but the business structure may
change as the plan for port resources changes. In the long run, the fertilizer and grain
handling business of the Company is expected to show a steady growth; and resource
allocation and business assignment between Chiwan Port and Machong Port will be
optimized as response to markets change, laying a foundation for the sustained
development of the Company’s bulk cargo handling business in the future.
2. Business Plan for 2012
In a changeable market environment, the Company will take initiative to alter its strategies
so as to seize market opportunities. Meanwhile, it will keep an eye on influence of state
policy amendments on imported cargos, as well as increasing near-sea cargos stimulated by
development of emerging Asian economies. It will also look for cooperation with other
ports in the region so as to keep competition in a healthy condition. It will continue to
improve quality of all kinds of services it provides, focus on its core competitive edge, and
maintain stability in core business and with major clients.
While trying to maintain the existing clients and market share, the Company will adopt
more proactive strategies to expand its business, and also attach great importance to market
and brand development. It will improve the governing environment for the port, expand
cargo sources by making use of the policy advantage of the bonded port, enhance its ability
to utilize and integrate internal and external resources, extend the service chain, and at the
same time proactively improve the operating efficiency and service quality as a way to
cope with the fierce competition among ports in the region.
The Company is well positioned to push forward research and innovation more deeply and
widely; improve the appraisal and incentive mechanism; upgrade management; increase its
resource distribution efficiency and allocation capability; encourage technical innovations
for controlling cost, saving energy & reducing CO2 emission and building green ports;
constantly increase vitality and sustainability of its core competitiveness; and enhance its
risk control capability as a whole.
In 2012, the Company will mainly work on the following construction projects: the Berth
35
2011 年年度报告
13 extension project in Chiwan Port to be commenced for accommodating more and more
larger ships, which will greatly improve our ability to receive and handle large ships at the
jetty; ancillary warehousing facilities for the first phase of the Machong Port Project,
including bonded and bulk grain warehouses; and the second phase of the Machong Port
Project.
Meanwhile, we will keep an eye on any possible opportunity arising from market and
industry changes, as well as investment orientations for resource and business integration.
Also, we will continuously enhance our ability to manage investments, assure progress of
all the construction projects, and keep a watch over companies that we invest in.
3. Capital requirements and expenditure plan for 2012
To implement our future development strategies and achieve business goals we have set, a
capital expenditure of RMB694 million is planned for 2012, of which RMB162 million
will be invested in fixed assets at Chiwan Port and RMB532 million will be invested in
Machong Port in Dongguan. The above capital expenditures will be mainly funded by cash
inflows from operating activities of the Company, bank borrowings and corporate bonds.
C. Investments during the reporting period
1. Utilization of raised proceeds
No funds were raised by the Company during the reporting period. Recently raised
funds had been fully utilized by the end of 1996.
2. Other investments
During the reporting period, capital expenditure decreased by RMB143 million to
RMB806.18 million, a drop of 15% over last year, among which:
Investee Investment amount (RMB million)
Chiwan Port 232.66
Machong Port 353.24
China Merchants Bonded Logistics Co., Ltd. 220.28
Total 806.18
Investments in Chiwan Port were utilized mainly for the berth extension project in
the container wharf, tugboat building and port equipment purchases;
Investments in Machong Port were utilized mainly for port equipment purchases,
land payment and construction payment;
Investments in CMBL were utilized mainly for equity interest investment and
capital increase in it, which enabled the Company to hold a 40% stake in CMBL
directly and indirectly. CMBL is mainly engaged in warehousing service, freight
delivery, cargo agent service, etc.
36
2011 年年度报告
3. During the reporting period, the Company did not launch any trust financing or
investment in derivative products.
D. Daily operations of the Board
1. Board meetings and resolutions
The Board held a total of 14 meetings (including 3 periodic meetings and 11 extraordinary
meetings) during the year. Details of the meetings are set out as follows:
date Session Resolutions of the session Disclosure situation
Published in Securities
The First Special
Resolution on Report of Electing the Times and Ta Kung Pao
Session of the
12 Jan. 2011 Chairman of the Sixth Board of on 13 Jan. 2011
Sixth Board of
Directors, etc. (Announcement No.:
Directors for 2011
2011-002).
Published in Securities
The Second
Times and Ta Kung Pao
Special Session of Resolution on Report of Engaging
28 Feb. 2011 on 1 Mar. 2011
the Sixth Board of the Vice GM of the Company
(Announcement No.:
Directors for 2011
2011-005).
Resolution on Report of Transferring
The Third Special 20% Equity Interests in China
Session of the Merchants Maritime Logistics
7 Mar. 2011
Sixth Board of (Shenzhen) Ltd. to Hinwin
Directors for 2011 Development Limited was reviewed
and approved.
Published in Securities
The Seventh
Times and Ta Kung Pao
Session of the Resolution on Work Report of the
25 Mar. 2011 on 29 Mar. 2011
Sixth Board of Board of Directors for 2010, etc.
(Announcement No.:
Directors
2011-007).
Published in Securities
The Fourth Special
Times and Ta Kung Pao
Session of the Resolution on the First Quarterly
27 Apr. 2011 on 28 Apr. 2011
Sixth Board of Report for 2011 of the Company, etc.
(Announcement No.:
Directors for 2011
2011-014).
1. Resolution on Report of Increasing
Published in Securities
The Fifth Special Investment on China Merchants
Times and Ta Kung Pao
Session of the Maritime Logistics (Shenzhen) Ltd.
26 May 2011 on 27 May 2011
Sixth Board of 2. Resolution on Report of Applying
(Announcement No.:
Directors for 2011 for Comprehensive Line of Credit to
2011-018).
Shenzhen Branch of Bank of Ningbo
Published in Securities
The First Session Resolution on Report of Electing the Times and Ta Kung Pao
27 May 2011 of the Seventh Chairman of the Seventh Board of on 28 May 2011
Board of Directors Directors, etc. (Announcement No.:
2011-021).
The First Special Resolution on Report of Adjusting
Session of the the Ratio of Capital Investment on
12 Jul. 2011
Seventh Board of the Berth 4# -5# Project at South
Directors for 2011 Xinsha, Machong Port Area, Humen
37
2011 年年度报告
Port, Dongguan was reviewed and
approved, which approved the
Company and Chiwan Wharf (Hong
Kong) Limited to increase the ratio of
capital investment on the Berth 4# -
5# project at South Xinsha, Machong
Port Area, Humen Port, Dongguan
from 25% : 75% to 43.75% : 56.25%.
1. Resolution on Report of Providing
The Second Published in Securities
Guarantee on Bank Line of Credit for
Special Session of Times and Ta Kung Pao
Controlling Subsidiaries
21 Jul. 2011 the Seventh Board on 22 Jul. 2011
2. Resolution on Report of Approval
of Directors for (Announcement No.:
Authority and Procedures of
2011 2011-026).
Significant Events of the Company
Published in Securities
The Second Resolution on the Full Text and
Times and Ta Kung Pao
Session of the Summary of the Semi-Annual
18 Aug. 2011 on 20 Aug. 2011
Seventh Board of Financial Report for 2011 of the
(Announcement No.:
Directors Company
2011-029).
1. Resolution on Report of the
Issuance Plan of the Corporate Bond
2. Report on Motioning the General
Meeting to Give the Board of
Directors Full Authority to Handle
Matters Related to the Corporate
Published in Securities
The Third Special Bond Plan under Applicable Laws
Times and Ta Kung Pao
Session of the and Regulations
5 Sept. 2011 on 9 Sept. 2011
Seventh Board of 3. Resolution on Report of the Date
(Announcement No.:
Directors for 2011 and Agenda of the First Special
2011-030).
Shareholders’ General Meeting for
2011
4. Resolution on Report of Applying
for Comprehensive Line of Credit to
Shenzhen Wuzhou Subbranch of
Shenzhen Development Bank
1. Resolution on Report of Applying
for Comprehensive Line of Credit to
Published in Securities
The Fourth Special Shenzhen Nanshan Subbranch of
Times and Ta Kung Pao
Session of the Agricultural Bank of China
19 Oct. 2011 on 21 Oct. 2011
Seventh Board of 2. Resolution on Report of Providing
(Announcement No.:
Directors for 2011 Guarantee for Shenzhen Chiwan
2011-037).
Harbour Container Co., Ltd., Wholly-
owned Subsidiary of the Company
1. Resolution on the Third Quarterly Published in Securities
The Fifth Special
Report for 2011 of the Company Times and Ta Kung Pao
Session of the
24 Oct. 2011 2. Resolution on Proposal about on 26 Oct. 2011
Seventh Board of
Adjusting the Issuing Scale of (Announcement No.:
Directors for 2011
Corporate Bond and Serial Issuance 2011-040).
Published in Securities
The Sixth Special
Resolution on Proposal about Times and Ta Kung Pao
Session of the
31 Dec. 2011 Engaging the Secretary to the Board on 5 Jan. 2012
Seventh Board of
of Directors of the Company (Announcement No.:
Directors for 2011
2012-001).
38
2011 年年度报告
2. Implementation by the Board of the resolutions passed at the Shareholders’ General
Meetings
Profit Distribution Plan for 2010 was reviewed and approved at the Company's Annual
Shareholders’ General Meeting for 2010 held on 27 May 2011. Based on a total share
capital of 644,763,730 shares as at the end of 2010, a cash dividend before tax of RMB4.63
for every ten shares totaling RMB298,525,607 was proposed.
The Board of the Company disclosed a public notice in respect of payment of dividend for
the year 2010 in Securities Times and Ta Kung Pao on 14 Jul. 2011, and completed the
dividends payment for both A shares and B shares on 22 Jul. and 26 Jul. 2011 respectively.
3. Establishment, improvement and principal contents of the working rules for the Audit
Committee and performance of the Audit Committee
In accordance with the Company Law of the PRC, the Corporate Governance Principle for
Listed Companies, the Articles of Association and other relevant requirements, the
Company established the Audit Committee under its Board of Directors and formulated the
Working Rules for the Audit Committee of the Board (“Working Rules”) and the Working
Practices for the Audit Committee of the Board on Annual Report (“Working Practices”).
The Working Rules and the Working Practices set forth specific provisions regarding the
composition, responsibility and authority, decision-making process and rules of the Audit
Committee and the works that need to be done in preparing and auditing annual reports,
which improved the Company’s corporate governance structure and mechanism, reinforced
the construction of internal control of the Company, and brought into full play the critical
role of the Audit Committee of the Board in preventing risks.
a. Five meetings of the Audit Committee were held during the year, i.e. the Audit
Committee of the Sixth Board of Directors of the Company held a total of two meetings
during the year, and the Audit Committee of the Seventh Board of Directors of the
Company held a total of three meetings during the year. Details of the meetings are set
out as follows:
① On 24 Mar. 2011, the First Session of the Audit Committee of the Sixth Board of
Directors for 2011 was held at 9:00 a.m., at Conference Room I, 13/F., Chiwan
Petroleum Building, Shenzhen, at which the following proposals were reviewed and
approved unanimously:
● “Internal Auditing Report of the Company for 2010” was reviewed and approved;
● “Internal Auditing Plan of the Company for 2011” was reviewed and approved;
● “Working Report of the Audit Committee of the Board in 2010” was reviewed and
approved;
● “The Financial Statements of 2010” was reviewed and approved and was submitted to
the Board of Directors of the Company for approval;
● “Working Report of the Accounting Firm in 2010” was reviewed and approved and was
submitted to the Board of Directors of the Company for approval;
● “Report on the Appointment of the Accounting Firm for 2011” was reviewed and
approved and was submitted to the Board of Directors of the Company for approval. The
39
2011 年年度报告
Audit Committee recommended the Board to re-appoint PricewaterhouseCoopers Zhong
Tian Certified Public Accountants as the Company's accounting firm for 2011.
② On 27 Apr. 2011, the First Special Session of the Audit Committee of the Sixth Board
of Directors for 2011 was held by way of telecommunication voting, at which the
“Report on the Company’s Work Plan for the Construction and Implementation of the
Internal Control Standards” and “Report on the Appointment of the Accounting Firm
for Auditing the Company’s Internal Control in 2011” was reviewed and approved
unanimously and submitted to the Board of Directors of the Company for approval.
③ On 27 May 2011, the First Session of the Audit Committee of the Seventh Board of
Directors for 2011 was held at 2:30 p.m. at Conference Room IV, 11/F., Chiwan
Petroleum Building, Shenzhen, at which “Report on Electing the Convener of the Audit
Committee of the Seventh Board of Directors” was reviewed and approved
unanimously and submitted to the Board of Directors of the Company for approval.
④ On 18 Aug. 2011, the Second Session of the Audit Committee of the Seventh Board of
Directors for 2011 was held at 8:30 a.m. at Conference Room V, 11/F., Chiwan
Petroleum Building, Shenzhen, at which the following proposals were reviewed and
approved unanimously:
● “The Semi-Annual Financial Report for 2011 of the Company” was reviewed and
approved and was submitted to the Board of Directors of the Company for approval;
● “The Semi-Annual Internal Auditing Report of the Company for 2011” was reviewed
and approved;
● “The Report on the Construction and Implementation Scope of the Company’s Internal
Control for 2011” was reviewed and approved.
⑤ On 19 Dec. 2011, the First Special Session of the Audit Committee of the Seventh
Board of Directors for 2011 was held at 9:00 a.m. at Conference Room I, 13/F., Chiwan
Petroleum Building, Shenzhen, at which the Report on the Company’s Auditing Work
of Finance and Internal Control by PricewaterhouseCoopers Zhong Tian Certified
Public Accountants for 2011 was debriefed.
b. In accordance with relevant requirements of CSRC and Shenzhen Stock Exchange, the
specific working rules and procedure for the Audit Committee, during the reporting
period, the Audit Committee of the Board of the Company oversaw the auditing of the
Annual Report of the Company for 2010 with due diligence, details of which are as
follows:
① Before the auditors started their work, the Audit Committee discussed with the principal
auditor of the accounting firm and determined, inter alia, the timing schedule for the
auditing work of the financial statements for the year.
② The Audit Committee expressed its audit opinions two times on the annual financial
statements of the Company for 2010.
40
2011 年年度报告
During the reporting period, the Audit Committee expressed its audit opinions two times
on the annual financial statements of the Company for 2010 in accordance with relevant
requirements from CSRC, details of which are as follows:
The Audit Committee reviewed the Financial Statements prepared by the Company and
issued the following opinions before the Auditors started their work: the Company was in
full compliance with relevant laws, regulations and the Articles of Association of the
Company, the units and items of the Company's financial statements to be consolidated
were complete, and the consolidation basis thereof was accurate and the information
included in the Financial Statements submitted by the Company was objective,
comprehensive and true. The Company's accounting policies were properly adopted and
the accounting estimates made were reasonable. No significant mistake or omission has
been identified so far. Due to the time-lag between this review of Financial Statements and
the dates of the Auditors' Report, we suggest the Finance Department focus on and deal
with subsequent events properly in accordance with the New Enterprises Accounting
Standards to ensure the fairness, truthfulness and completeness of the Financial Statements.
After the Auditors issued their preliminary audit opinions, the Audit Committee reviewed
the Financial Statements again and issued the following opinions: the Company prepared
the Financial Statement in full compliance with the New Enterprise Accounting Standards
and relevant provisions of the financial control system of the Company, the procedures for
the preparation of the Financial Statements were reasonable and proper, which gave a true
and fair view of the Company's assets, liabilities, equity interests and operation results as at
31 December 2010. Information included in the Financial Statements was objective and
complete. Financial Statements for 2010 which was preliminarily audited by
PricewaterhouseCoopers Zhong Tian Certified Public Accountants may be submitted for
review at the Seventh Session of the Sixth Board of Directors.
③ Supervision over the Auditing Work of the Accounting firm
The Audit Committee issued letters to PricewaterhouseCoopers Zhong Tian Certified
Public Accountants on 19 Jan. and 18 Feb. 2011 respectively to urge them to produce their
audit report in a timely manner, so as to ensure the annual audit and information disclosure
proceed as scheduled.
④ Opinions on the Auditing Work Performed by the Accountants for the previous year
During the auditing period, the Audit Committee of the Board focused on the problems
discovered in process of audit, urged auditors to finish the preparation of their report within
a prescribed period of time and ensured the truthfulness, accuracy and completeness of the
annual report. The Certified Public Accountants issued a standard unqualified audit report
on 25 Mar. 2011. The Audit Committee considered that the Certified Public Accountants
conducted their audit in accordance with China’s Independent Auditing Standards, the
audit time was sufficient, the deployment of the auditors was appropriate and their
practicing capability was excellent, and that the audit report issued sufficiently reflected
the Company's financial condition as at 31 Dec. 2010 and its operation results and cash
flows for the year 2010 and the audit conclusion made was in line with the actual situation
of the Company.
41
2011 年年度报告
⑤ During the reporting period, the Audit Committee placed great emphasis on the
establishment of the internal control and supervision department of the Company and
its personnel deployment. The Audit Department was required to submit its working
report for the previous year and working plan for the current year to the Audit
Committee and report the establishment and implementation of the internal control
system, which enabled the Audit Committee to understand the implementation and
effect of the internal control system. In addition, the Audit Committee advised on the
improvement for the work of the Audit Department and the Company relating to
internal control for the next year.
4. Performance of the Nomination, Remuneration and Evaluation Committee
During the reporting period, six meetings of the Nomination, Remuneration and Evaluation
Committee were held during the year, i.e. the Nomination, Remuneration and Evaluation
Committee of the Sixth Board of Directors held a total of four meetings, and the
Nomination, Remuneration and Evaluation Committee of the Seventh Board of Directors
held a total of two meetings, details of which are as follows:
a. On 12 Jan. 2011, the First Session of the Nomination, Remuneration and Evaluation
Committee of the Sixth Board of Directors for 2011 was held at 9:30 a.m. at Conference
Room VI, 11/F., Chiwan Petroleum Building, Shenzhen, at which “Report on the
Engagement of the Company’s Executive Vice GM” was reviewed and approved and
submitted to the Board of Directors of the Company for approval;
b. On 25 Feb. 2011, the Second Special Session of the Nomination, Remuneration and
Evaluation Committee of the Sixth Board of Directors for 2011 was held by way of
telecommunication voting, at which “Report on the Engagement of the Company’s Vice
GM” was reviewed and approved unanimously and submitted to the Board of Directors
of the Company for approval;
c. On 24 Mar. 2011, the Third Session of the Nomination, Remuneration and Evaluation
Committee of the Sixth Board of Directors for 2011 was held at 2:00 p.m. at Conference
Room I, 13/F., Chiwan Petroleum Building, Shenzhen, at which the “Working Report of
the Nomination, Remuneration and Evaluation Committee of the Board for 2010”, the
“Report on the Remuneration of the Directors, Supervisors and Senior Management
Staff for 2010” and the “Report on the Examination of the Director Candidate” were
reviewed and approved;
d. On 27 Apr. 2011, the Fourth Special Session of the Nomination, Remuneration and
Evaluation Committee of the Sixth Board of Directors for 2011 was held by way of
telecommunication voting, at which the “Report on Adjusting the Withdrawal Ratio of
the Medium to Long Term Incentive Fund” was reviewed and approved unanimously
and submitted to the Board of Directors of the Company for approval;
e. On 27 May 2011, the First Session of the Nomination, Remuneration and Evaluation
Committee of the Seventh Board of Directors for 2011 was held at 2:50 p.m. at
42
2011 年年度报告
Conference Room IV, 11/F., Chiwan Petroleum Building, Shenzhen, at which the
following proposals were reviewed and approved:
● “The Report on Electing the Convener of the Nomination, Remuneration and Evaluation
Committee of the Seventh Board of Directors” was reviewed and approved and was
submitted to the Board of Directors of the Company for approval;
● “The Report on the Engagement of the Company’s Executive Vice GM” was reviewed
and approved and was submitted to the Board of Directors of the Company for approval;
● “The Report on Assuming the Post of the Company’s Vice GM” was reviewed and
approved and was submitted to the Board of Directors of the Company for approval;
● “The Report on the Engagement of the Company’s CFO” was reviewed and approved
and was submitted to the Board of Directors of the Company for approval;
● “The Report on the Engagement of the Secretary to the Board” was reviewed and
approved and was submitted to the Board of Directors of the Company for approval.
f. On 31 Dec. 2011, the Second Special Session of the Nomination, Remuneration and
Evaluation Committee of the Seventh Board of Directors for 2011 was held by way of
telecommunication voting, at which the Plan on the Engagement of the Secretary to the
Board was reviewed and approved unanimously and was submitted to the Board of
Directors of the Company for approval.
5. Performance of the Strategy Committee
During the reporting period, two meetings of the Strategy Committee were held during the
year, i.e. the Strategy Committee of the Sixth Board of Directors of the Company held one
meeting, and the Strategy Committee of the Seventh Board of Directors of the Company
held a total of two meetings during the year. Details of the meetings are set out as follows:
a. On 24 Mar. 2011, the First Session of the Strategy Committee of the Sixth Board of
Directors for 2011 was held at 2:30 p.m. at Conference Room I, 13/F., Chiwan
Petroleum Building, Shenzhen, at which the following proposals were reviewed and
approved unanimously:
● “The Report on Electing the Convener of the Strategy Committee of the Sixth Board of
Directors” was reviewed and approved and was submitted to the Board of Directors of
the Company for approval;
● “The Working Report of the Strategy Committee of the Board for 2010” was reviewed
and approved;
● “The Business Development Plan for 2011 to 2015” was reviewed and approved.
b. On 27 May 2011, the First Session of the Strategy Committee of the Seventh Board of
Directors for 2011 was held at 2:40 p.m. at Conference Room IV, 11/F., Chiwan
Petroleum Building, Shenzhen, at which the “Report on Electing the Convener of the
Strategy Committee of the Seventh Board of Directors” was reviewed and approved
unanimously and was submitted to the Board of Directors of the Company for approval.
c. On 9 Dec. 2011, the Second Session of the Strategy Committee of the Seventh Board of
Directors for 2011 was held by way of telecommunication voting, at which the
“Proposal on Adding Machong Bundline” was reviewed and approved unanimously.
43
2011 年年度报告
During the reporting period, members of the Strategy Committee conducted research and
advised on the investment plans and assets operation projects related to the medium to long
term development strategy of the Company.
E. Profit Distribution Proposal for 2011
As audited by PricewaterhouseCoopers Zhong Tian Certified Public Accountants Co., Ltd.,
net profit of the Company for 2011 was RMB430,118,633 and the accumulative profits
available for distribution was RMB668,245,566.
a. In accordance with the provisions of the Company Law and the Articles of Association
of the Company, the Company is going to draw 10% of net profit of the Company
audited for the year 2011, namely RMB43,011,863, as statutory surplus reserve.
b. The Company would plan to distribute dividend of RMB4.00 (tax included) in cash for
every 10 shares based on the total share capital of 644,763,730 shares as at the end of
2011, totaling RMB257,905,492.
After the aforesaid distribution, the residual retained profit of the Company was
RMB367,328,211.
The above profit distribution proposal shall be submitted to 2011 Annual General Meeting
for review and approval.
F. Cash Dividends Distributed in the last three years
Unit: RMB
Net profit attributable to equity
Amount of cash
Year of holders of the Company in the Distributable profit
dividends Percentage
distribution consolidated financial statements for the year
(Including tax)
for the year of distribution
2010 298,525,607 596,680,156 50.03% 574,774,541
2009 209,548,212 418,864,844 50.03% 431,538,411
2008 322,381,865 642,891,604 50.15% 514,467,212
Percentage of aggregated cash dividends in the last three years in
150.22%
the recent annual average net profit (%)
G. Establishment and Execution of the Management Rules on Insider Information
and Insiders
The Company established the Management Rules on Inside Information and Insiders in
accordance with the Articles of Association of the Company and other laws and regulations,
which was reviewed and approved at the Seventh Special Session of the Sixth Board of
Directors for 2009 held on 29 Oct. 2009, and then issued for implementation. In
compliance with the document spirit of Regulation on Establishing Management Rules of
44
2011 年年度报告
Insiders Registration in Listed Company from CSRC, Notice on Establishing Management
Rules of Insiders Registration from Shenzhen Securities Regulatory Bureau and
Memorandum of Information Disclosure No. 34— Management Issues on Insiders
Registration from Shenzhen Stock Exchange, the Company revised the Management Rules
on Inside Information and Insiders by connecting with the practice, which was reviewed
and approved at the First Special Session of the Seventh Board of Directors for 2012 on 27
Feb. 2012 and issued for implementation.
The rules set forth specific provisions regarding the management on information submitted
to external entities. The Company submitted “Undisclosed Information Provided by the
Company to its Substantial Shareholders and Actual Controller” to the Shenzhen Securities
Regulatory Bureau every month, including the name list and related information of parties
aware of such undisclosed information and relevant information. No information insiders
have been found trading the Company’s shares by taking advantage of insider information.
PART X REPORT OF THE SUPERVISORY COMMITTEE
A. Within the reporting period, in accordance with the Company Law of the PRC
and the Company’s Articles of Association, the Supervisory Committee conducted
examination and supervision, carried out its rights and obligations as well as
delegated its representatives to attend the Board Meeting and gave its opinions
upon the Company’s decision-making regarding significant issues. The
Supervisory Committee held six meetings in 2011.
date Session Resolutions of the session Disclosure situation
Published in Securities
The First Special Resolution on Report of Rectification
Times and Ta Kung Pao
Session of the Sixth Plan for On-site Inspection by
12 Jan. 2011 on 13 Jan. 2011
Supervisory Shenzhen Securities Regulatory
(Announcement No.:
Committee for 2011 Bureau
2011-003).
1. Resolution on Working Report of
the Supervisory Committee for 2010
2. Resolution on Annual Report of the Published in Securities
The Seventh Session
Company for 2010 and its Summary Times and Ta Kung Pao
of the Sixth
25 Mar. 2011 3. Resolution on Self-evaluation on 29 Mar. 2011
Supervisory
Report on Internal Control of the (Announcement No.:
Committee
Company for 2010 2011-008).
4. Resolution on Report of the Re-
election of the Supervisory Committee
The Second Special
Session of the Sixth Resolution on the First Quarterly
27 Apr. 2011
Supervisory Report for 2011
Committee for 2011
Published in Securities
The First Session of
Resolution on Report of electing the Times and Ta Kung Pao
the Seventh
27 May 2011 Chairman of the Seventh Supervisory on 28 May 2011
Supervisory
Committee (Announcement No.:
Committee
2011-022).
45
2011 年年度报告
The Second Session
Resolution on Semi-annual Report of
of the Seventh
18 Aug. 2011 the Company for 2011 and its
Supervisory
Summary
Committee
The First Special
Session of the Resolution on the Third Quarterly
24 Oct. 2011
Seventh Supervisory Report for 2011
Committee
B. Opinion of the Supervisory Committee on the internal control self-evaluation
.
According to the Basic Norms for Internal Control of Enterprises and its mating guideline,
the Company evaluated the internal control effectiveness as at 31 Dec. 2011 and
formulated the 2011 Annual Internal Control Self-evaluation Report, which was reviewed
and approved at the Third Session of the Seventh Board of Directors on 37 Mar. 2012. The
Supervisory Committee of the Company hereby expresses its opinion on the report as
follows:
During the reporting period, the Company formulated and improved the financial reporting
internal control rules, which were effectively executed. The internal control system was in
line with the operation and development needs of the Company, which prevented risks and
ensured the safety of the Company’s assets. The internal control self-evaluation report gave
a factual and complete presentation of the actual situation of the Company’s internal
control.
In overall, we believe that the 2011 Annual Internal Control Self-evaluation Report is
complete, true and accurate, and gives a true picture of the actual situation of the
Company’s internal control. Therefore, we accept it to be disclosed on the websites chosen
by the Company for information disclosure.
C. Establishment and Execution of the Management Rules on Insider Information
and Insiders (for details, please refer to Part IX. G)
PART XI SIGNIFICANT EVENTS
A. The Company had no significant lawsuits or arbitration cases involved in the year.
B. During the reporting period, there were no non-operating appropriations or
repayment of funds by the controlling shareholder and its related parties.
PricewaterhouseCoopers Zhong Tian Certified Public Accountants issued
Opinions on Appropriations of Funds of Shenzhen Chiwan Wharf Holdings
Limited by the Controlling Shareholder and Its Related Parties, details of the
report please refer to Website for Information Disclosure.
C. The Company had no significant events relevant to bankruptcy reorganization in
the year.
D. Particulars about holding equities of other public companies
Set out below are the equity interests the Company held in other public companies during
46
2011 年年度报告
the reporting period, which were invested in previous periods.
Changes in
1 Jan. 2011 31 Dec. 2011 Gain
Book owners’
Initial during
Stock Stock value at equity Accounti Source of
investment the
code name Propo Propor the end of during the ng item shares
amount Amount Amount reporting
rtion tion the period reporting
period
period
Shares
held by
legal
Available
entity,
Jiangsu -for-sale
600377 1,120,000 100000 0.02% 100000 0.02% 5,690,000 - (767,700) which is
Expressway financial
allowed for
assets
circulation
after share
reform
ShenZhen
Long-
Petro-
term Shares
chemical
400032 3,500,000 780000 0.26% 780000 0.26% 382,200 - - equity held by
Industry
investme legal entity
(Group)
nts
Co., Ltd.
GuangDon Long-
g Guang term Shares
400009 Jian Group 27,500 20000 0.02% 20000 0.02% 17,000 - - equity held by
Limited investme legal entity
Company nts
Total 4,647,500 6,089,200 - (767,700)
E. The Company had no purchase and sales of significant assets or business
combination in the year.
F. During the reporting period, the Company did not formulate and implement any
equity incentive schemes.
G. Significant related-party transactions
1. Related party transactions relating to daily operation
Land lease payment
Rental for the lease of stockyard land by the Company from related party was negotiated
between the parties and settled through banks. Details of the land lease rental payable for
2011 are as follows:
2011 2010
CND 41,915,516 41,479,353
To meet the requirements of the Company’s daily operations, Harbor Division of the
Company and CCT, in which the Company holds 55% equity interests directly and
indirectly, lease several pieces of lands from CND for bulk cargo and container stacking
each year. The transactions are the Company's recurrent operations, which were conducted
in the past and will continue in the future.
Relevant rental was negotiated between the parties and was substantially the same as rental
for land leases in the western port area of Shenzhen for 2011. The monthly rental was
47
2011 年年度报告
RMB4 to RMB14 for each square meter, payable on a monthly basis. In the case of
overdue payment, a late payment fee equivalent to 0.5% of monthly rental shall be charged
for every day overdue.
With an amount of RMB41.92 million, the above transaction accounted for 71% of the
Company's rental for stockyard and offices during the reporting period. Total volume of
the above transaction was expected to be RMB51 million throughout 2011, while the
actual amount was 82% of the estimation.
2. Related transaction concerning purchase and sales of assets
Unit: RMB’000
Net profit
contributed to the Whether or
Whether or
Company from not all the Relationship
not all the
Counterparty the purchase date ownership with the related
Whether or involved
or ultimate Acquired or to the end of the Pricing of the party
Purchase Trading price not related credits and
controlling swap-in assets year (applicable principle involved (applicable for
transaction liabilities
party for the business assets has related
have been
combination not been transaction)
transferred
under the same transferred
control)
China The subsidiary
Merchants Hinwin of the
4 May Fair
Holdings Development 100,292.68 2,186.77 Yes Yes Yes controlling
2011 value
(International) Limited shareholder of
Company the Company
3. Related transaction concerning the external investment by the Company together with
the related party
Unit: RMB’000
Name of Progress of
the Registered significant
Joint investor Main business Total asset Net asset Net profit
invested capital project in
company construction
China Merchants
Holdings 90% of the
(International) Warehouse
warehouse
Company rental service,
construction
distribution of
Shenzhen Chiwan CMBL 700,000.00 1,463,544.74 642,392.23 8,558.37 had been
goods, freight
Wharf Holdings completed
forwarding
Limited at the end
business, etc.
Hinwin Development of 2011
Limited
4. Credits and liabilities between related parties and the Company
a. Cash at bank and on hand
31 Dec. 2011 31 Dec. 2010
China Merchants Bank 58,812,732 123,853,303
It accounted for 12% of total cash at bank and on hand.
48
2011 年年度报告
b. Short-term borrowings
31 Dec. 2011 31 Dec. 2010
China Merchants Bank 137,700,000 50,000,000
It accounted for 10% of total short-term borrowings.
H. Significant contracts and execution
1. During the reporting period, the Company did not hold in trust, contract or lease any
significant assets from other companies, nor did it put in trust, contract or lease its
significant assets to other companies.
2. During the reporting period, the Company did not provide any illegal or external
guarantees.
As at the end of the reporting period, the Company provided guarantees only for the bank
loans granted to Shenzhen Chiwan Harbour Container Co., Ltd. and Dongguan Chiwan
Wharf Company Limited (“Dongguan Wharf”), a subsidiary of the Company, details of
which are as follows:
Unit: RMB’000
Subsisting
Amount
guarantee Type of
Guarantee of Term of guarantee Procedures for guarantee
liability guarantee
guarantee
or not
Shenzhen
Reviewed and approved at the
Chiwan Guarantee
Fourth Special Session of the
Harbour 32,400 2011.10.21-2012.10.20 Yes with joint
Seventh Board of Directors of
Container liability
the Company for 2011
Co., Ltd.
Reviewed and approved at the
Sixth Special Session of the
Sixth Board of Directors of
Guarantee
Dongguan the Company for 2009 and
375 2011.8.16-2012.2.16 Yes with joint
Wharf then also reviewed and
liability
approved at the First Special
Shareholders’ General
Meeting for 2009
Reviewed and approved at the
Guarantee
Dongguan Second Special Session of the
100,000 2011.10.21-2016.10.20 Yes with joint
Wharf Seventh Board of Directors of
liability
the Company for 2011
As at the end of the reporting period, guarantees provided by the Company (including
guarantees for its subsidiaries) amounted to RMB132.78 million, accounting for 3.83% of
the net assets of the Company.
3. During the reporting period, the Company did not entrust others to conduct cash assets
management.
49
2011 年年度报告
I. Appointment of accountings
As approved by the Annual General Meeting for 2010 held on 27 May 2011, the Company
appointed PricewaterhouseCoopers Zhong Tian Certified Public Accountants as the
Company’s accounting firm for 2011 to audit the annual financial report and internal
control. PricewaterhouseCoopers Zhong Tian Certified Public Accountants has been
providing auditing service for the Company for eleven consecutive years, where Mr. Zhou
Weiran, the accountant putting signature to the audit report, provides the audit service for
the Company for the first year, and Ms. Kong Yu has provided the audit service for the
Company for three consecutive years.
Remunerations paid in the reporting year are set out as follows:
2011
PricewaterhouseCoopers Zhong Tian Certified Public Accountants
Audit fees for
RMB1.76 million
financial report
Audit fees for
RMB0.85 million
internal control
J. During the reporting period, none of the Company, its Directors, Supervisors,
Senior Management, shareholders or actual controllers was subject to
investigation by competent authorities, enforcement measures by judicial and
regulatory authorities, transfer to judicial departments or prosecution for criminal
liability, inspection or administrative punishment by CSRC, non-admission to
securities market, or punishment by other administrative departments or public
condemnation by Shenzhen Stock Exchange as a result of being identified as an
inappropriate candidate.
K. Interviews and visits in the reporting year
In the reporting period, the Company handled warm-heartedly investors’ phone calls and
held one-on-one meetings with investors. The Company disclosed relevant information to
investors in accordance with the Company Law, the Securities Law, the Rules on the
Management of Investors Relations and other laws and regulations. In 2011, the Company
received in aggregate 34 visits. The Company gave visitors an introduction to the profile of
the Company and the development of its business, and made reasonable disclosures
regarding the operations, investments and financial status of the Company that the
investors were interested in. The Company did not disclose, reveal or divulge to any
specific visitors any material information not generally available to the public. Details are
as follows:
Topics
discussed
Type Time Location Means Investor and
information
provided
Promotional UBS Basic
Jan. 2011 Shanghai Clients of UBS
activities Conference information
launched of operations
Jun. 2011
by security Shenzhen Conference Clients of China Merchants Securities and
by China
50
2011 年年度报告
firms Merchants investments
Securities of the
UBS Company and
Hong Kong Clients of UBS
Conference the financial
Conference status of the
by Company
Shanghai Clients of Changjiang Securities
Changjiang
Nov. 2011 Information
Securities
Conference provided:
Hong Kong Clients of Jefferies Brochure of
by Jefferies
Conference the Company
Dec. 2011 Hong Kong by Clients of J.P.Morgan
J.P.Morgan
Tel
Goldman Sachs (Asia) L.L.C.
Jan. 2011 conference
China Merchants Securities, UBS
Changjiang Securities, Lion Fund Management
Co., Ltd., Dacheng Fund Management Co.,
Ltd., SWS Research Co., Ltd., Bank of China
Investment Management, Matthews
International Capital Management LLC,
One-on-one Guosen Securities, China AMC, First State
meeting Cinda Fund Management Co., Ltd., Haitong
Securities, E-Fund Management Co., Ltd.,
Feb. 2011
China Merchants Fund Management Co., Ltd.,
Industrial Securities Co., Ltd., Rongtong Fund,
Essence Securities, SYWG BNP Paribas Asset
Management Co., Ltd., Minsheng Royal Fund
Management Co., Ltd., Mizuho Corporate
Bank Ltd.
Tel
Guosen Securities
conference
One-on-one
Mar. 2011 Theleme Partners LLP
meeting
Receiving Apr. 2011 Tel Templeton Emerging Markets
Conference conference
visits from Theleme Partners LLP、Kelusa Capital
room of the
investors Morgan Stanley Huaxin Funds, China
Company
Merchants Fund, Sinolink Securities, China
Merchants Securities, Jefferies, SWS
Research, CICC, Yuanhao Capital
Management, United Innovation Capital Ltd.,
May 2011 CP Capital, ZENDAI Investment, Hang Seng
Investment, Huaqiang Dingxin Investment,
Huaqiang Investment & Guaranty, Cowin
Investment, Huatai Securities, Aisawa
One-on-one Securities, CSC, Macquarie, CIMC, Guosen
meeting Securities, UBS Securities Company Limited,
Citic Securities
Jun. 2011 CMHI, CLSA
Jul. 2011 Jianghai Securities
Aug. 2011 Industrial Securities
Magellan Financial Group, BOC International
Sept. 2011
(China) Limited
Nov. 2011 UBS
One-on-one GF Securities, Penghua Fund Management
meeting Co., Ltd.
Dec. 2011
Tel
Templeton Emerging Markets
conference
51
2011 年年度报告
L. Other significant events
Date of No. of Newspaper and
Events Website
announcement announcement reference page
On 26 May 2011, the Company held the Fifth Special
Session of the Sixth Board of Directors for 2011, at which
reviewed and approved unanimously the Report on
Increasing Investment on China Merchants Maritime and
Logistics (Shenzhen) Ltd., agreeing to invest RMB0.12 D17 on Securities
billion to China Merchants Maritime and Logistics Times and B3 on
http://www.
(Shenzhen) Ltd. for holding 40% equities. Relevant Capital 2011-5-27 2011-019 Ta Kung Pao; D9
cninfo.
Increase Agreement was signed in Shenzhen, Guangdong at 2011-10-13 2011-036 on Securities
com.cn
the afternoon of that day. The said investment formed a Times and B7 on
related-party transaction in accordance with the Rules Ta Kung Pao
Governing the Listing of Stocks on Shenzhen Stock
Exchange.
The Company already paid all the capital contribution under
the agreement on 26 Aug. 2011.
On 21 Jul. 2011, the Company held the Second Special
Session of the Seventh Board of Directors for 2011, at which
reviewed and approved unanimously the Report on Providing
the Bank Credit Line Guarantee for Subsidiary, agreeing the
D20 on Securities http://www.
Company to provide joint liability guarantee for Dongguan
2011-7-22 2011-027 Times and B3 on cninfo.
Chiwan Wharf Company Limited with credit line of RMB
Ta Kung Pao com.cn
0.2 billion authorized by Shenzhen Branch of Nanyang
Commercial Bank. The guarantee period were two years
since Dongguan Wharf finished the loans under the Loan
Contract with Nanyang Commercial Bank.
On 19 Oct. 2011, the Company held the Fourth Special
Session of the Seventh Board of Directors for 2011, at which
reviewed and approved unanimously the Proposal on
D17 on Securities http://www.
Providing Guarantee for Shenzhen Chiwan Harbour
2011-10-21 2011-038 Times and B5 on cninfo.
Container Co., Ltd. to Gain the Loan Granted by the
Ta Kung Pao com.cn
Shenzhen Nanshan Sub-branch of the Agricultural Bank of
China. The said credit line was RMB100 million with a term
of one year.
On 28 Nov. 2011, the Company received the Reply of CSRC
on Approving Shenzhen Chiwan Wharf Holdings Limited to
Publicly Issue the Corporate Bonds (Zheng-Jian-Xu-Ke
[2011] No. 1889), which approved the Company to publicly
issue the corporate bonds with par value not more than 1
billion; the corporate bonds would be issued in phases, the
par value of the first-phase bonds should not less than 50%
of the total par value of the issued bonds, and it should be D25 on Securities http://www.
completed within six months since the approval date; bonds 2011-11-30 2011-043 Times and A31 cninfo.
issued in the other phases should be completed within 24 on Ta Kung Pao com.cn
months since the approval date. The reply came to effective
within 24 months since the approval date (24 Nov. 2011)
The Company would handle the matters relevant to the said
corporate bonds issuance in accordance with the
requirements of relevant laws, regulations and the above
reply, as well as the authorization of the Company’s
Shareholders’ General Meeting.
On 15 Nov. 2011, CMBLSA RE FTIF TEMPLETON
ASIAN GRW FD GTI 5496 (hereinafter referred to as
“TEMPLETON”), a subsidiary of Templeton Asset
Management Ltd. holding over 5% equities of the Company, D15 on Securities http://www.
reduced to hold part of the Company’s shares during the 2011-12-13 2011-045 Times and C6 on cninfo.
process of increasing shareholding, which formed an illegal Ta Kung Pao com.cn
stock trading behavior. The Company has disclosed the
matters on illegal stock trading of TEMPLETON, who has
returned the gains.
52
2011 年年度报告
PART XII FINANCIAL STATEMENTS (See attached)
PART XIII DOCUMENTS FOR REFERENCE
1. Financial Statements carrying the signatures and stamps of the Company's legal
representative, the Chief Financial Officer and the person in charge of accounting firm;
2. Original copy of the Auditor's Report stamped by the accounting firm and signed and
stamped by registered accountants;
3. Original copies of all documents and the announcements thereof disclosed in the
reporting period on “Securities Times” and “Ta Kung Pao”; and
4. Original copy of the Annual Report signed by the Chairman.
For and on behalf of the Board
Zheng Shaoping
Chairman
Shenzhen Chiwan Wharf Holdings Limited
Dated 28 March 2012
53
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
FINANCIAL STATEMENTS AND
REPORT OF THE AUDITORS
FOR THE YEAR ENDED 31 DECEMBER 2011
[English Translation for Reference Only. Should there be any inconsistency
between the Chinese and English versions, the Chinese version shall prevail.]
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
[English translation for reference only]
Contents Page
Financial Statements and Report of the Auditors for the year
ended 31 December 2011
Report of the auditors 1-2
Consolidated and Company’s balance sheets 3-4
Consolidated and Company’s income statements 5
Consolidated and Company’s cash flow statements 6
Consolidated statement of changes in owners’ equity 7
Company’s statement of changes in owners’ equity 8
Notes to financial statements 9 - 122
Supplementary information to financial statements 123- 125
[English translation for reference only]
Report of Auditors
PwC ZT Shen Zi (2012) No.10030
(Page 1 of 2)
To the Shareholders of Shenzhen Chiwan Wharf Holdings Limited：
We have audited the accompanying financial statements of Shenzhen Chiwan Wharf Holdings Limited
(hereinafter “Chiwan Wharf”), which comprise the consolidated and company balance sheets as at 31
December 2011, and the consolidated and company income statements, the consolidated and
company statements of changes in shareholders’ equity and the consolidated and company cash flow
statements for the year then ended, and the notes to the financial statements.
Management’s Responsibility for the Financial Statements
Management of Chiwan Wharf is responsible for the preparation and fair presentation of these
financial statements in accordance with the requirements of Accounting Standards for Business
Enterprises, and for such internal control as management determines is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We
conducted our audit in accordance with the China Standards on Auditing. Those standards require
that we comply with ethical requirements and plan and perform the audit to obtain reasonable
assurance whether the financial statements are free from material misstatement.
-1-
[English translation for reference only]
PwC ZT Shen Zi (2012) No. 10030
(Page 2 of 2)
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation of the financial statements in order to design audit procedures that are appropriate in the
circumstances. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Opinion
In our opinion, the accompanying financial statements present fairly, in all material respects, the
consolidated and company’s financial position of Chiwan Wharf as of 31 December 2011, and their
financial performance and cash flows for the year then ended in accordance with the requirements of
Accounting Standards for Business Enterprises.
PricewaterhouseCoopers Zhong Tian CPAs Limited Company
Shanghai, the People’s Republic of China
27 March 2012
-2-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
CONSOLIDATED AND COMPANY BALANCE SHEETS
AS AT 31 DECEMBER 2011
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
31 December 31 December 31 December 31 December
2011 2010 2011 2010
ASSETS Note(s) Consolidated Consolidated Company Company
Current assets
Cash at bank and on hand 5(1) 478,788,943 781,720,083 187,090,694 494,364,355
Notes receivable 5(2) - 4,640,000 - 1,700,000
Accounts receivable 5(4), 14(1) 230,797,003 179,772,755 16,623,725 9,336,968
Advances to suppliers 5(6) 3,497,668 31,256,172 1,210,724 316,780
Interest receivable 5(3) 51,667 1,318,202 206,151 91,902
Dividends receivable - - 529,289,881 304,203,089
Other receivables 5(5), 14(2) 11,833,877 52,765,361 243,256,537 365,862,136
Inventories 5(7) 23,500,358 23,888,526 922,921 1,099,168
Other current assets 1,003,913 - - -
Total current assets 749,473,429 1,075,361,099 978,600,633 1,176,974,398
Non-current assets
Available-for-sale financial assets 5(8) 5,690,000 6,640,000 5,690,000 6,640,000
Long-term receivables 7(6) - - 11,004,304 11,004,304
Long-term equity investments 5(9), 14(3) 1,436,856,420 1,149,921,886 2,002,116,574 1,589,644,572
Investment properties 5(11) 34,679,229 29,379,544 26,547,149 20,991,116
Fixed assets 5(12) 2,482,077,688 2,652,957,915 156,481,155 156,903,932
Construction in progress 5(13) 517,818,144 14,593,516 614,894 450,900
Intangible assets 5(14) 1,038,926,892 1,074,247,819 65,552,356 68,371,761
Goodwill 5(15) 10,858,898 10,858,898 - -
Long-term prepaid expenses 5(16) 62,488,532 63,848,189 5,770,046 5,299,666
Deferred tax assets 5(18) 59,250,919 52,083,662 29,709,461 21,221,357
Other non-current assets 5(17) 142,108,284 72,292,214 - -
Total non-current assets 5,790,755,006 5,126,823,643 2,303,485,939 1,880,527,608
TOTAL ASSETS 6,540,228,435 6,202,184,742 3,282,086,572 3,057,502,006
-3-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
CONSOLIDATED AND COMPANY BALANCE SHEETS
AS AT 31 DECEMBER 2011 (Con’d)
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
31 December 31 December 31 December 31 December
LIABILITIES AND 2011 2010 2011 2010
OWNERS’ EQUITY Note(s) Consolidated Consolidated Company Company
Current liabilities
Short-term borrowings 5(20) 1,418,830,000 1,225,550,000 584,530,000 478,550,000
Notes payable 5(21) 8,704,900 1,895,750 7,493,900 -
Accounts payable 5(22) 160,112,954 214,723,251 12,225,607 16,221,238
Advances from customers 5(23) 5,045,311 4,769,320 3,907,291 3,643,835
Employee benefits payable 5(24) 55,945,867 36,929,912 31,818,160 15,275,662
Taxes payable 5(25) 121,781,050 100,583,520 1,392,629 605,756
Interests payable 5(26) 1,637,790 2,958,406 2,361,250 1,829,970
Dividends payable 5(27) 365,161,451 213,351,043 - -
Other payables 5(28) 50,809,293 45,027,806 749,075,206 570,336,042
Current portion of non-current liabilities 5(29) 14,951,750 412,951,750 - 212,500,000
Total current liabilities 2,202,980,366 2,258,740,758 1,392,804,043 1,298,962,503
Non-current liabilities
Long-term borrowings 5(30) 90,000,000 - - -
Special payable 5(31) 81,790,541 69,119,645 - -
Deferred tax liabilities 5(18) 1,142,500 1,324,800 1,142,500 1,324,800
Other non-current liabilities 5(32) 58,250,957 65,841,707 - -
Total non-current liabilities 231,183,998 136,286,152 1,142,500 1,324,800
Total liabilities 2,434,164,364 2,395,026,910 1,393,946,543 1,300,287,303
Owners' equity
Share capital 5(33) 644,763,730 644,763,730 644,763,730 644,763,730
Capital surplus 5(34) 166,226,055 144,909,755 153,438,328 154,106,028
Surplus reserves 5(35) 421,692,405 383,570,404 421,692,405 383,570,404
Undistributed profits 5(36) 2,248,722,001 2,079,724,472 668,245,566 574,774,541
Foreign exchange translation differences (13,607,440) (13,419,303) - -
Total equity attributable to equity holders of
the Company 3,467,796,751 3,239,549,058 1,888,140,029 1,757,214,703
Minority interests 5(37) 638,267,320 567,608,774 - -
Total owners' equity 4,106,064,071 3,807,157,832 1,888,140,029 1,757,214,703
TOTAL LIABILITIES AND OWNERS’ EQUITY 6,540,228,435 6,202,184,742 3,282,086,572 3,057,502,006
The accompanying notes form an integral part of these financial statements.
-4-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
CONSOLIDATED AND COMPANY INCOME STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2011 2010 2011 2010
Items Note(s) Consolidated Consolidated Company Company
Revenue 5(38),14(4) 1,708,136,899 1,740,417,668 189,122,522 159,991,095
Less: Cost of sales 5(38),14(4) (768,040,243) (742,312,284) (136,475,924) (134,094,813)
Tax and levies on operations 5(39) (71,021,926) (63,815,927) (8,055,454) (6,211,103)
General and administrative
expenses 5(40) (158,186,232) (130,781,048) (62,568,055) (45,463,645)
Financial (expenses) /income - net 5(41) (12,370,981) 10,535,505 (28,651,836) (940,246)
Asset impairment reversals/(losses) 5(43) ( 251,074) (119,061) (38,601) (24,478)
Add: Investment income 5(42),14(5) 118,228,183 148,514,648 468,021,351 407,131,078
Including: share of results of
associates 5(42) 113,968,183 148,204,648 34,396,865 42,929,224
Operating profit 816,494,626 962,439,501 421,354,003 380,387,888
Add: Non-operating income 5(44) 1,878,537 5,012,970 1,718,849 833,575
Less: Non-operating expenses 5(45) ( 2,035,862) (3,037,490) (1,442,326) (765,610)
Including: Loss on disposals of non-
current assets (1,960,173 ) (2,834,944) (1,437,106) (687,689)
Total profit 816,337,301 964,414,981 421,630,526 380,455,853
Less: Income tax (expenses)/ income 5(46) (148,561,633) (137,775,617) 8,488,107 764,157
Net profit 667,775,668 826,639,364 430,118,633 381,220,010
Attributable to equity holders of the
Company 505,645,137 596,680,156
Minority interests 162,130,531 229,959,208
Earnings per share
(attributable to equity holders of the
Company)
Basic earnings per share 5(49) 0.784 0.925
Diluted earnings per share 5(49) 0.784 0.925
Other comprehensive income (855,837) (565,642) (667,700) (500,400)
Total comprehensive income 666,919,831 826,073,722 429,450,933 380,719,610
Attributable to equity holders of the
Company 504,789,300 596,114,514
Minority interest 162,130,531 229,959,208
The accompanying notes form an integral part of these financial statements.
-5-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
2011 2010 2011 2010
Items Note(s) Consolidated Consolidated Company Company
1. Cash flows from operating activities
Cash received from rendering of services 1,649,531,912 1,747,846,505 181,861,014 157,334,344
Cash received relating to other operating
activities 5(51) 31,724,082 31,299,096 711,446,584 603,753,822
Sub-total of cash inflows 1,681,255,994 1,779,145,601 893,307,598 761,088,166
Cash paid for goods and services (412,465,800) (361,828,341) (98,191,799) (72,539,169)
Cash paid to and on behalf of employees (218,888,671) (204,083,048) (60,366,911) (55,544,227)
Payments of taxes and levies (225,859,493) (212,353,178) (9,322,699) (8,862,658)
Cash paid relating to other operating
activities 5(51) (77,851,434) (74,035,465) (427,548,733) (340,563,057)
Sub-total of cash outflows (935,065,398) (852,300,032) (595,430,142) (477,509,111)
Net cash flows from operating activities 5(52) 746,190,596 926,845,569 297,877,456 283,579,055
2. Cash flows from investing activities
Cash received from disposals of investments 44,879,120 155,574,511 - 94,000,000
Cash received from returns on investments 51,044,863 310,000 210,574,000 316,109,210
Net cash received from disposals of fixed
assets and intangible assets 1,039,749 12,277,696 807,083 1,383,341
Cash received relating to other investing
activities - - - 12,478,235
Sub-total of cash inflows 96,963,732 168,162,207 211,381,083 423,970,786
Cash paid to purchase fixed assets,
intangible assets and other long-term
assets (585,894,854) (199,524,278) (13,063,802) (5,307,600)
Cash paid relating to other investing
activities - (749,655,300) (379,200,000) (779,655,300)
Net cash paid from disposal of subsidiaries
and other business units (220,284,181) - - -
Sub-total of cash outflows (806,179,035) (949,179,578) (392,263,802) (784,962,900)
Net cash flows from investing activities (709,215,303) (781,017,371) (180,882,719) (360,992,114)
3. Cash flows from financing activities
Cash received by investors 91,940,000 - - -
Include: Cash received in subsidiary by
minority shareholders 91,940,000 - - -
Cash received from borrowings 1,449,050,000 1,489,120,000 728,550,000 556,480,000
Sub-total of cash inflows 1,540,990,000 1,489,120,000 728,550,000 556,480,000
Cash repayments of borrowings (1,506,050,000) (1,178,320,000) (818,550,000) (216,480,000)
Cash payments for interest expenses and
distribution of dividends or profits (361,238,309) (408,546,358) (330,952,458) (220,050,769)
Include: Distribution of dividends and
profits to minority
shareholders in subsidiary - (171,889,814) - -
Cash paid relating to other activities (4,448,649) (1,401,288) (2,606,625) (1,101,714)
Sub-total of cash outflows (1,871,736,958) (1,588,267,646) (1,152,109,083) (437,632,483)
Net cash flows from financing activities (330,746,958) (99,147,646) (423,559,083) 118,847,517
4. Effect of foreign exchange rate changes
on cash and cash equivalents (9,159,475) (6,056,736) (709,315) (478,061)
5. Net increase in cash and cash
equivalents (302,931,140) 40,623,816 (307,273,661) 40,956,397
Add: Cash and cash equivalents at
beginning of year 5(52) 781,720,083 741,096,267 494,364,355 453,407,958
6. Cash and cash equivalent at end of year 5(52) 478,788,943 781,720,083 187,090,694 494,364,355
The accompanying notes form an integral part of these financial statements.
-6-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN OWNERS’ EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
Attributable to equity holders of the Company
Share Capital Surplus Undistributed Translation Minority Total owners'
Items Note capital surplus reserves profits difference interest equity
Balance at 1 January 2010 644,763,730 145,410,155 355,134,736 1,721,028,196 (13,354,061) 567,608,774 3,420,591,530
Movement for the year ended 31 December 2010
Net profit - - - 596,680,156 - 229,959,208 826,639,364
Other comprehensive income 5(34) - (500,400) - - (65,242) - (565,642)
Profit appropriation
- appropriation to surplus reserves 5(35) - - 28,435,668 (28,435,668) - - -
- profit distribution to equity owners 5(36) - - - (209,548,212) - (229,959,208) (439,507,420)
Balance at 31 December 2010 644,763,730 144,909,755 383,570,404 2,079,724,472 (13,419,303) 567,608,774 3,807,157,832
Balance at 1 January 2011 644,763,730 144,909,755 383,570,404 2,079,724,472 (13,419,303) 567,608,774 3,807,157,832
Movement for the year ended 31 December 2011
Investment by shareholders 4(1) - 20,774,000 - - - 71,166,000 91,940,000
Net profit - - - 505,645,137 - 162,130,531 667,775,668
Other comprehensive income 5(34) - (667,700) - - (188,137) - (855,837)
Profit appropriation
- appropriation to surplus reserves 5(35) - - 38,122,001 (38,122,001) - - -
- profit distribution to equity owners 5(36) - - - (298,525,607) - (163,627,985) (462,153,592)
Others - 1,210,000 - - - 990,000 2,200,000
Balance at 31 December 2011 644,763,730 166,226,055 421,692,405 2,248,722,001 (13,607,440) 638,267,320 4,106,064,071
The accompanying notes form an integral part of these financial statements.
-7-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
COMPANY STATEMENT OF CHANGES IN OWNERS’ EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB Yuan unless otherwise stated)
[English translation for reference only]
Items Note Share capital Capital surplus Surplus reserves Undistributed profits Total owners' equity
Balance at 1 January 2010 644,763,730 154,606,428 355,134,736 431,538,411 1,586,043,305
Movement for the year ended 31 December 2010
Net profit - - - 381,220,010 381,220,010
Other comprehensive income 5(34) - (500,400) - - (500,400)
Profit distribution -
- appropriation to surplus reserves 5(35) - - 28,435,668 (28,435,668) -
- profit distribution to equity owners 5(36) - - - (209,548,212) (209,548,212)
Balance at 31 December 2010 644,763,730 154,106,028 383,570,404 574,774,541 1,757,214,703
Balance at 1 January 2011 644,763,730 154,106,028 383,570,404 574,774,541 1,757,214,703
Movement for the year ended 31 December 2011
Net profit - - - 430,118,633 430,118,633
Other comprehensive income 5(34) - (667,700) - - (667,700)
Profit distribution
- appropriation to surplus reserves 5(35) - - 38,122,001 (38,122,001) -
- profit distribution to equity owners 5(36) - - - (298,525,607) (298,525,607)
Balance at 31 December 2011 644,763,730 153,438,328 421,692,405 668,245,566 1,888,140,029
The accompanying notes form an integral part of these financial statements.
-8-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
1 General information
Shenzhen Chiwan Wharf Holdings Limited (the “Company”) was incorporated in September 1982
in Shenzhen, the People’s Republic of China (the “PRC”), by China Nanshan Development (Group)
Ltd (the “Nanshan Group”), and was registered a sino-foreign joint venture enterprise in July 1990.
In January 1993, as approved by the Shenzhen municipal government with document SFBF
(1993)357, the Company was reorganized into a joint stock limited company. In February 1993, the
Company issued, by public offering, the domestic shares (“A shares”) of 46,000,000 shares and
domestically listed foreign shares (“B shares”) of 40,000,000 shares. Both shares were listed in
Shenzhen Stock Exchange in May 1993.
In June 1994, 31,047,000 bonus shares were issued in a proportion of “one bonus share for every
ten shares”. In June, the bonus A shares and bonus B shares held by Nanshan Group were listed
in Shenzhen Stock Exchange. In December 1995, the Company issued additional 40,000,000 B
shares, consequently, the total volume of the Company’s shares rose to 381,517,000.
In June 2004, the directors of the Company resolved to increase the share capital by means of
capitalization of the share premium and capital reserves of the Company to the extent that 3
additional ordinary shares were issued to each shareholder holding 10 shares of the Company. As
the result, the total volume of shares was increased from 381,517,000 to 495,972,100.
In July 2005, again the directors of the Company resolved to increase the share capital by means
of capitalization of the share premium and capital reserves of the Company to the extent that 3
additional ordinary shares were issued to each shareholder holding 10 shares of the Company.
Consequently, the total volume of shares was increased from 495,972,100 to 644,763,700.
The Company and its subsidiaries (collectively the “Group”) are principally engaged in the provision
of cargo packing, cargo handling, container terminal, warehousing, land and sea transportation
services.
These consolidated financial statements have been approved for issue by the Board of Directors
on 27 March 2012. .
-9-
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates
(1) Basis of preparation
The financial statements were prepared in accordance with the Basic Standard and 38 specific
standards of the Accounting Standards for Business Enterprises issued by the Ministry of Finance
on 15 February 2006, and the Application Guidance for Accounting Standards for Business
Enterprises, Interpretations of Accounting Standards for Business Enterprises and other relevant
regulations issued thereafter (hereafter collectively referred to as “the Accounting Standards for
Business Enterprises” or “CAS”) and the disclosure requirements in the Preparation Convention of
Information Disclosure by Companies Offering Securities to the Public No.15 – General Rules on
Financial Reporting (2010 revised) issued by the China Securities Regulatory Commission.
(2) Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements of the Company for the year ended 31 December 2011 are in compliance
with the Accounting Standards for Business Enterprises, and truly and completely present the
financial position of the Consolidated and the Company as of 31 December 2011 and of their
financial performance, cash flows and other information for the year then ended.
(3) Accounting year
The Company’s accounting year starts on 1 January and ends on 31 December.
(4) Recording currency
The recording currency is Renminbi (RMB).
(5) Business Combinations
(a) Business combinations involving enterprises under common control
The consideration paid and net assets obtained by the absorbing party in a business combination
are measured at the carrying amount. The difference between the carrying amount of the net
assets obtained from the combination and the carrying amount of the consideration paid for the
combination is treated as an adjustment to capital surplus (share premium). If the capital surplus
(share premium) is not sufficient to absorb the difference, the remaining balance is adjusted
against retained earnings. Costs directly attributable to the combination are included in profit or
loss in the period in which they are incurred. Transaction costs associated with the issue of equity
or debt securities for the business combination are included in the initially recognised amounts of
the equity or debt securities.
- 10 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(5) Business Combinations(Con’d)
(b) Business combinations involving enterprises not under common control
The cost of combination and identifiable net assets obtained by the acquirer in a business
combination are measured at fair value at the acquisition date. Where the cost of the combination
exceeds the acquirer’s interest in the fair value of the acquiree’s identifiable net assets, the
difference is recognised as goodwill; where the cost of combination is lower than the acquirer’s
interest in the fair value of the acquiree’s identifiable net assets, the difference is recognised in
profit or loss for the current period. Costs directly attributable to the combination are included in
profit or loss in the period in which they are incurred. Transaction costs associated with the issue of
equity or debt securities for the business combination are included in the initially recognised
amounts of the equity or debt securities.
(6) Preparation of consolidated financial statements
The consolidated financial statements comprise the financial statements of the Company and all of
its subsidiaries.
Subsidiaries are consolidated from the date on which the Group obtains control and are de-
consolidated from the date that such control ceases. For a subsidiary that is acquired in a business
combination involving enterprises under common control, it is included in the consolidated financial
statements from the date when it, together with the Company, comes under common control of the
ultimate controlling party. The portion of the net profits realised before the combination date is
presented separately in the consolidated income statement.
In preparing the consolidated financial statements, where the accounting policies and the
accounting periods of the Company and subsidiaries are inconsistent, the financial statements of
the subsidiaries are adjusted in accordance with the accounting policies and the accounting period
of the Company. For subsidiaries acquired from business combinations involving enterprises not
under common control, the individual financial statements of the subsidiaries are adjusted based
on the fair value of the identifiable net assets at the acquisition date.
All significant intra-group balances, transactions and unrealised profits are eliminated in the
consolidated financial statements. The portion of subsidiaries’ equity and the portion of a
subsidiaries’ net profits and losses for the period not attributable to Company are recognised as
minority interests and presented separately in the consolidated financial statements under equity
and net profits respectively.
- 11 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(7) Disposal of minority interest in subsidiary
In preparing the consolidated financial statements, the difference between the minority interest
increased by the disposal and net assets of subsidiary calculated by the shareholding portion from
the date of acquisition (or the date of consolidation) ,is adjusted to owners’ equity(capital surplus).If
the capital surplus is not efficient ,then surplus reserves will be adjusted.
(8) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn on demand,
and short-term and highly liquid investments that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in value.
(9) Foreign currency translation
(a) Foreign currency transactions
Foreign currency transactions are translated into RMB using the exchange rates prevailing at the
dates of the transactions.
At the balance sheet date, monetary items denominated in foreign currency are translated into
RMB using the spot exchange rate at the balance sheet date. Exchange differences arising from
these translations are recognised in profit or loss for the current period, except for those
attributable to foreign currency borrowings that have been taken out specifically for the acquisition
or construction of qualifying assets, which are capitalised as part of the cost of those assets. Non-
monetary items denominated in foreign currency that are measured in terms of historical cost are
translated at the balance sheet date using the spot exchange rate at the date of the transaction.
The effect of exchange rate changes on cash is presented separately in the cash flow statement.
(b) Translation of foreign currency financial statements
The asset and liability items in the balance sheets for overseas businesses are translated at the
spot exchange rate on the balance sheet date. Among the owner’s equity items, the items other
than “undistributed profits” are translated at the spot exchange rate of the transaction date. The
income and expense items in the income statements of overseas businesses are translated at the
spot exchange rate of the transaction date. The differences arising from the above translation are
presented separately in the owner’s equities. The cash flows of overseas businesses are translated
at the spot exchange rate on the date of the cash flows. The effect of exchange rate changes on
cash is presented separately in the cash flow statement.
- 12 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(10) Financial instruments
(a) Financial assets
(i) Classification of financial assets
Financial assets are classified into the following categories at initial recognition: financial assets at
fair value through profit or loss, loans and receivables, available-for-sale financial assets and held-
to-maturity investments. The classification of financial assets depends on the Group’s intention and
ability to hold the financial assets.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss include financial assets held for the purpose of
selling in the short term, which are presented as financial assets held for trading on the balance
sheet.
Receivables
Receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market.
Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are either designated in
this category or not classified in any of the other categories at initial recognition. Available-for-sale
financial assets are included in other current assets in the balance sheet if management intends to
dispose of them within 12 months of the balance sheet date.
Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets with fixed maturity and fixed or
determinable payments that management has the positive intention and ability to hold to maturity.
Held-to-maturity investments with maturities over 12 months when the investments were made but
are due within 12 months at the balance sheet date are included in current portion of non-current
assets; held-to maturity investments with maturities no more than 12 months when the investments
were made are included in other current assets.
- 13 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(10) Financial instruments (Con’d)
(a) Financial assets (Con’d)
(ii) Recognition and measurement
Financial assets are recognised at fair value on the balance sheet when the Group becomes a
party to the contractual provisions of the financial instrument. In the case of financial assets at fair
value through profit or loss, the related transaction costs incurred at the time of acquisition are
recognised in profit or loss for the current period. For other financial assets, transaction costs that
are attributable to the acquisition of the financial assets are included in their initially recognised
amounts.
Financial assets at fair value through profit or loss and available-for-sale financial assets are
subsequently measured at fair value. Investments in equity instruments are measured at cost when
they do not have a quoted market price in an active market and whose fair value cannot be reliably
measured. Receivables and held-to-maturity investments are measured at amortised cost using the
effective interest method.
Gains or losses arising from change in the fair value of financial assets at fair value through profit
or loss are recognised in profit or loss. Interests and cash dividends received during the period in
which such financial assets are held, as well as the gains or losses arising from disposal of these
assets are recognised in profit or loss for the current period.
Gains or losses arising from change in fair value of available-for-sale financial assets are
recognised directly in equity, except for impairment losses and foreign exchange gains and losses
arising from translation of monetary financial assets. When such financial assets are derecognised,
the cumulative gains or losses previously recognised directly into equity is recycled into profit or
loss for the current period. Interests on available-for-sale investments in debt instruments
calculated using the effective interest method during the period in which such investments are held
and cash dividends declared by the investee on available-for-sale investments in equity
instruments are recognised as investment income, which is recognised in profit or loss for the
period.
- 14 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(10) Financial instruments (Con’d)
(a) Financial assets (Con’d)
(iii) Impairment of financial assets
The Group assesses the carrying amounts of financial assets other than those at fair value through
profit or loss at each balance sheet date. If there is objective evidence that a financial asset is
impaired, an impairment loss is provided for.
When an impairment loss on a financial asset carried at amortised cost has occurred, the amount
of loss is provided for at the difference between the asset’s carrying amount and the present value
of its estimated future cash flows (excluding future credit losses that have not been incurred). If
there is objective evidence that the value of the financial asset recovered and the recovery is
related objectively to an event occurring after the impairment was recognised, the previously
recognised impairment loss is reversed and the amount of reversal is recognised in profit or loss.
If there is objective evidence that an impairment loss on available-for-sale financial assets incurred,
the cumulative losses arising from the decline in fair value that had been recognised directly in
equity are transferred out from equity and into impairment loss. For an investment in debt
instrument classified as available-for-sale on which impairment losses have been recognised, if, in
a subsequent period, its fair value increases and the increase can be objectively related to an
event occurring after the impairment loss was recognised in profit or loss, the previously
recognised impairment loss is reversed into profit or loss for the current period. For an investment
in an equity instrument classified as available-for-sale on which impairment losses have been
recognised, the increase in its fair value in a subsequent period is recognised directly in equity.
(iv) Derecognition of financial assets
A financial asset is derecognised when any of the below criteria is met: (i) the contractual rights to
receive the cash flows from the financial asset expire; (ii) the financial asset has been transferred
and the Group transfers substantially all the risks and rewards of ownership of the financial asset to
the transferee; or (iii) the financial asset has been transferred and the Group has not retained
control of the financial asset, although the Group neither transfers nor retains substantially all the
risks and rewards of ownership of the financial asset.
On derecognition of a financial asset, the difference between the carrying amount and the sum of
the consideration received and the cumulative changes in fair value that had been recognised
directly in equity, is recognised in profit or loss.
- 15 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(10) Financial instruments (Con’d)
(b) Financial liabilities
Financial liabilities are classified into the following categories at initial recognition: financial liabilities
at fair value through profit or loss and other financial liabilities. The financial liabilities of the Group
mainly comprise other financial liabilities, including payables, borrowings and debentures payable.
Payables, including accounts payable and other payables, are recognised initially at fair value and
subsequently measured at amortised cost using the effective interest method.
Borrowings and debentures payable are recognised initially at fair value, net of transaction costs
incurred, and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities with maturities no more than one year are classified as current liabilities.
Other financial liabilities with maturities over one year but are due within one year at the balance
sheet date are classified as the current portion of non-current liabilities. Others are classified as
non-current liabilities.
A financial liability is derecognised or partly derecognised when the current obligation is discharged
or partly discharged. The difference between the carrying amount of the financial liability or the
derecognised part of the financial liability and the consideration paid is recognised in profit or loss.
(c) Determination of fair value of financial instruments
The fair value of a financial instrument that is traded in an active market is determined at the
quoted price in the active market. The fair value of a financial instrument that is not traded in an
active market is determined by using a valuation technique. Valuation techniques include using
prices of recent market transactions between knowledgeable and willing parties, reference to the
current fair value of another financial asset that is substantially the same with this instrument, and
discounted cash flow analysis, etc. When a valuation technique is used to establish the fair value of
a financial instrument, it makes the maximum use of observable market inputs and relies as little as
possible on entity-specific inputs.
- 16 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(11) Receivables
Receivables comprise accounts receivable and other receivables. Accounts receivable arising from
sale of goods or rendering of services are initially recognised at fair value of the contractual
payments from the buyers or service recipients.
(a) Receivables with amounts that are individually significant and subject to separate assessment for
provision for bad debts
Receivables with amounts that are individually significant are subject to assessment for
impairment on the individual basis. If there exists objective evidence that the Group will not be able
to collect the amount under the original terms, a provision for impairment of that receivable is made.
The criterion for determining individually significant amounts is the top five individually significant
amounts.
The method of providing for bad debts for those individually significant amounts is as follows: the
amount of the present value of the future cash flows expected to be derived from the receivable
below its carrying amount.
(b) The receivables that are grouped for providing bad debt provision
Receivables with amounts that are not individually significant and those receivables that have been
individually assessed for impairment and have not been found impaired are classified into certain
groupings based on their credit risk characteristics. The provision for bad debts is determined
based on the historical loss experience for the groupings of receivables with similar credit risk
characteristics, taking into consideration of the current circumstances.
The basis of similar credit risk group: the aging of receivables
Method of determining provision for bad debts by groupings –Ageing analysis method
The provision ratios used under the ageing analysis method for the above groupings are as follows:
Provision ratios used for Provision ratios used for
accounts receivable (%) other receivables (%)
Within 1 year 0 0
1 to 2 years 0-10 0-10
2 to 3 years 0-30 0-30
3 to 4 years 0-60 0-60
4 to 5 years 0-60 0-60
Over 5 years 50-100 50-100
- 17 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(11) Receivables (Con’d)
(c) Receivables with amounts that are not individually significant but subject to separate assessment
for provision for bad debts
The reason for making separate assessment for provision for bad debts is that there exists
objective evidence that the Group will not be able to collect the amount under the original terms of
the receivable.
The provision for bad debts is determined based on the amount of the present value of the future
cash flows expected to be derived from the receivable below its carrying amount.
(d) When the Group transfers the accounts receivable to the financial institutions without recourse, the
difference between the proceeds received from the transaction and their carrying amounts and the
related taxes is recognised in profit or loss for the current period.
(12) Inventories
(a) Classification
Inventories include spare parts, fuel, and low value consumables, and are measured at the lower of
cost and net realisable value.
(b) Costing of inventories
Cost of spare parts and fuel is determined on the weighted average method.
(c) Basis for determining net realisable values of inventories and method for making provision for
decline in the value of inventories
Provision for decline in the value of inventories is determined at the excess amount of the carrying
amounts of the inventories over their net realisable value. Net realisable value is determined based
on the estimated selling price in the ordinary course of business, less the estimated costs to
completion and estimated costs necessary to make the sale and related taxes.
(d) The Group adopts the perpetual inventory system.
(e) Amortisation methods of low value consumables
Low value consumables are amortised into expenses based upon numbers of usage.
- 18 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(13) Long-term equity investments
Long-term equity investments comprise the Company’s long-term equity investments in its
subsidiaries, the Group’s long-term equity investments in its joint ventures and associates, as well
as the long-term equity investments where the Group does not have control, joint control or
significant influence over the investees and which are not quoted in an active market and whose
fair value cannot be reliably measured.
Subsidiaries are the investees over which the Company is able to exercise control. Joint ventures
are the investees over which the Group is able to exercise joint control together with other
venturers. Associates are the investees that the Group has significant influence on their financial
and operating policies.
Investments in subsidiaries are presented in the Company’s financial statements using the cost
method, and are adjusted to the equity method when preparing the consolidated financial
statements. Investments in joint ventures and associates are accounted for using the equity
method. Other long-term equity investments, where the Group does not have control, joint control
or significant influence over the investees and which are not quoted in an active market and whose
fair value cannot be reliably measured, are accounted for using the cost method.
(a) Determination of investment cost
For long-term equity investments acquired through a business combination: for long-term equity
investments acquired through a business combination involving enterprises under common control,
the investment cost shall be the absorbing party’s share of the carrying amount of owners’ equity of
the party being absorbed at the combination date; for long-term equity investment acquired through
a business combination involving enterprises not under common control, the investment cost shall
be the combination cost.
For long-term equity investments acquired not through a business combination: for long-term equity
investment acquired by payment in cash, the initial investment cost shall be the purchase price
actually paid; for long-term equity investments acquired by issuing equity securities, the initial
investment cost shall be the fair value of the equity securities issued.
- 19 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(13) Long-term equity investments (Con’d)
(b) Subsequent measurement and recognition of related profit and loss
For long-term equity investments accounted for using the cost method, they are measured at the
initial investment costs, and cash dividends or profit distribution declared by the investees are
recognised as investment income in profit or loss.
For long-term equity investments accounted for using the equity method, where the initial
investment cost of a long-term equity investment exceeds the Group’s share of the fair value of the
investee’s identifiable net assets at the acquisition date, the long-term equity investment is
measured at the initial investment cost; where the initial investment cost is less than the Group’s
share of the fair value of the investee’s identifiable net assets at the acquisition date, the difference
is included in profit or loss and the cost of the long-term equity investment is adjusted upwards
accordingly.
For long-term equity investments accounted for using the equity method, the Group recognises the
investment income according to its share of net profit or loss of the investee. The Group
discontinues recognising its share of net losses of an investee after the carrying amount of the
long-term equity investment together with any long-term interests that, in substance, form part of
the investor’s net investment in the investee are reduced to zero. However, if the Group has
obligations for additional losses and the criteria with respect to recognition of provisions under the
accounting standards on contingencies are satisfied, the Group continues recognising the
investment losses and the provisions. For changes in owners’ equity of the investee other than
those arising from its net profit or loss, the Group records its proportionate share directly into
capital surplus, provided that the Group’s proportion of shareholding in the investee remains
unchanged. The carrying amount of the investment is reduced by the Group’s share of the profit
distribution or cash dividends declared by an investee. The unrealised profits or losses arising from
the intra-group transactions amongst the Group and its investees are eliminated in proportion to the
Group’s equity interest in the investees, and then based on which the investment gains or losses
are recognised. For the loss on the intra-group transaction amongst the Group and its investees
attributable to asset impairment, any unrealised loss is not eliminated.
- 20 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(13) Long-term equity investments (Con’d)
(c) Basis for determing existence of control, jointly control or significant influence over investees
Control is the power to govern the financial and operating policies of the investee so as to obtain
benefits from its operating activities. In determining whether the Company is able to exercise
control over the investee, the effect of potential voting rights over the investee is considered, such
as convertible debts and warrants currently exercisable, etc.
Joint control is the contractually agreed sharing of control over an economic activity, and exists
only when the strategic financial and operating decisions relating to the activity require the
unanimous consent of the parties sharing control.
Significant influence is the power to participate in the financial and operating policy decisions of the
investee, but is not control or joint control over those policies.
(d) Impairment of long-term equity investments
The carrying amounts of long-term equity investments in subsidiaries, joint ventures and associates
are reduced to the recoverable amounts when the recoverable amounts are below their carrying
amounts (Note 2 (19)). For other long-term equity investments which are not quoted in an active
market and whose fair values cannot be reliably measured, the excess of their carrying amounts
over the present values of future cash flows discounted at the prevailing market yield rate for
similar financial assets is recognised as impairment loss and cannot be reversed once recognised.
(14) Investment properties
Investment properties, including land use rights that have already been leased out, buildings that
are held for the purpose of leasing, and buildings that are being constructed or developed for the
purpose of leasing in future, are measured initially at cost. Subsequent expenditures incurred in
relation to an investment property are included in the cost of the investment property when it is
probable that the associated economic benefits will flow to the Group and their costs can be
reliably measured; otherwise, the expenditures are recognised in profit or loss in the period in
which they are incurred.
- 21 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(14) Investment properties (Con’d)
The Group adopts the cost model for subsequent measurement of investment properties. Buildings
and land use rights are depreciated or amortised to their estimated net residual values over their
estimated useful lives. The estimated useful lives, the estimated net residual values that are
expressed as a percentage of cost and the annual depreciation (amortisation) rates of investment
properties are as follows:
Estimated Annual depreciation
Estimated useful lives residual value (amortization) rate
Buildings 25 - 33 years 10% 2.7% to 3.6%
Land use rights 8 - 38 years - 2.6% to 12.5%
When an investment property is transferred to owner-occupied properties, it is reclassified as fixed
asset or intangible asset at the date of the transfer. When an owner-occupied property is
transferred out for earning rentals or for capital appreciation, the fixed asset or intangible asset is
reclassified as investment properties at its carrying amount at the date of the transfer.
The investment property’s estimated useful life, net residual value and depreciation (amortisation)
method applied are reviewed and adjusted as appropriate at each year-end.
An investment property is derecognised on disposal or when the investment property is
permanently withdrawn from use and no future economic benefits are expected from its disposal.
The net amount of proceeds from sale, transfer, retirement or damage of an investment property
after its carrying amount and related taxes and expenses is recognised in profit or loss for the
current period.
The carrying amount of an investment property is reduced to the recoverable amount if the
recoverable amount is below the carrying amount (Note 2 (19)).
- 22 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(15) Fixed assets
(a) Fixed assets recognition and initial measurement
Fixed assets comprise harbor facilities, warehouses, container yards and buildings, machinery and
equipment, motor vehicles, cargo ships and tugboats, and other equipments.
Fixed assets are recognised when it is probable that the related economic benefits will flow to the
Group and the costs can be reliably measured. Fixed assets purchased or constructed by the
Group are initially measured at cost at the acquisition date. The fixed assets contributed by the
State shareholders at the reorganisation of the Company into a corporation entity are recognised
based on the revaluated amounts approved by the state-owned assets administration department.
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset when
it is probable that the associated economic benefits will flow to the Group and the related cost can
be reliably measured. The carrying amount of the replaced part is derecognised. All the other
subsequent expenditures are recognised in profit or loss in the period in which they are incurred.
(b) Depreciation methods of fixed assets
Fixed assets are depreciated using the straight-line method to allocate the cost of the assets to
their estimated residual values over their estimated useful lives. For the fixed assets that have
been provided for impairment loss, the related depreciation charge is prospectively determined
based upon the adjusted carrying amounts over their remaining useful lives.
The estimated useful lives, the estimated residual values expressed as a percentage of cost and
the annual depreciation rates of fixed assets are as follows:
Estimated Estimated Annual
useful lives residual value depreciation rate
Harbor facilities 5 - 50 years 10% 1.8%-18%
warehouses, container yards and buildings 5 - 40 years 10% 2.25%-18%
machinery and equipments 5 - 15 years 10% 6%-18%
motor vehicles, cargo ships and tugboats 5 - 20 years 10% 4.5%-18%
other equipments 5 years 10% 18%
The estimated useful life, the estimated net residual value of a fixed asset and the depreciation
method applied to the asset are reviewed, and adjusted as appropriate at each year-end.
(c) The carrying amount of a fixed asset is reduced to the recoverable amount when the recoverable
amount is below the carrying amount (Note 2(19)).
- 23 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(15) Fixed assets (Con’d)
(d) Disposal of fixed assets
A fixed asset is derecognised on disposal or when no future economic benefits are expected from
its use or disposal. The amount of proceeds from disposals on sale, transfer, retirement or damage
of a fixed asset net of its carrying amount and related taxes and expenses is recognised in profit or
loss for the current period.
(16) Construction in progress
Construction in progress is measured at actual cost. Actual cost comprises construction costs,
installation costs, borrowing costs that are eligible for capitalisation and other costs necessary to
bring the fixed assets ready for their intended use. Construction in progress is transferred to fixed
assets when the assets are ready for their intended use, and depreciation begins from the following
month. The carrying amount of construction in progress is reduced to the recoverable amount
when the recoverable amount is below the carrying amount (Note 2(19)).
(17) Borrowing costs
The borrowing costs that are directly attributable to the acquisition and construction of a fixed asset
that needs a substantially long period of time for its intended use commence to be capitalised and
recorded as part of the cost of the asset when expenditures for the asset and borrowing costs have
been incurred, and the activities relating to the acquisition and construction that are necessary to
prepare the asset for its intended use have commenced. The capitalisation of borrowing costs
ceases when the asset under acquisition or construction becomes ready for its intended use and
the borrowing costs incurred thereafter are recognised in profit or loss for the current period.
Capitalisation of borrowing costs is suspended during periods in which the acquisition or
construction of a fixed asset is interrupted abnormally and the interruption lasts for more than 3
months, until the acquisition or construction is resumed.
For the specific borrowings obtained for the acquisition or construction of a fixed asset qualifying
for capitalisation, the amount of borrowing costs eligible for capitalisation is determined by
deducting any interest income earned from depositing the unused specific borrowings in the banks
or any investment income arising on the temporary investment of those borrowings during the
capitalisation period.
- 24 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(17) Borrowing costs
For the general borrowings obtained for the acquisition or construction of a fixed asset qualifying
for capitalisation, the amount of borrowing costs eligible for capitalisation is determined by applying
the weighted average effective interest rate of general borrowings, to the weighted average of the
excess amount of cumulative expenditures on the asset over the amount of specific borrowings.
The effective interest rate is the rate at which the estimated future cash flows during the period of
expected duration of the borrowings or applicable shorter period are discounted to the initial
amount of the borrowings.
(18) Intangible assets
Intangible assets including land use rights, coastal line use rights and computer software are
measured at actual cost. Fixed assets contributed by the state-owned shareholders at the
incorporation of a limited company are initially recorded at the valuation amount recognized by the
state-owned assets supervision and administration department.
(a) Land use rights
Land use rights are amortised on the straight-line basis over their estimated useful lives of 20 - 50
years. If the purchase costs of land use rights and attached buildings cannot be reliably allocated
between the land use rights and buildings, for the purchase costs are recognised as fixed assets.
(b) Coastal line use rights
Coastal line use rights are amortised on the straight-line basis over periods of 5 - 50 years.
(c) Computer software
Computer software is amortised on a straight-line basis over periods of 3 - 5 years.
(d) Periodical review of useful life and amortisation method
For an intangible asset with a finite useful life, review and adjustment on useful life and
amortization method are performed at each year-end.
(e) Impairment of intangible assets
The carrying amount of intangible assets is reduced to the recoverable amount when the
recoverable amount is below the carrying amount (Note 2 (19)).
- 25 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(19) Long-term prepaid expenses
Long-term prepaid expenses include the expenditure for improvements to fixed assets under
operating lease and other prepayments incurred but should be borne by the current and
subsequent periods and amortised over more than one year. Long-term prepaid expenses are
amortised on the straight-line basis over the expected beneficial period and are presented at cost
net of accumulated amortisation.
(20) Impairment of long-term assets
Fixed assets, construction in progress, intangible assets with finite useful lives, investment
properties measured using the cost model and long-term equity investments in subsidiaries, joint
ventures and associates are tested for impairment if there is any indication that an asset may be
impaired at the balance date. If the result of the impairment test indicates that the recoverable
amount of the asset is less than its carrying amount, a provision for impairment and an impairment
loss are recognised for the amount by which the asset’s carrying amount exceeds its recoverable
amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and the
present value of the future cash flows expected to be derived from the asset. A provision for asset
Impairment is determined and recognised on an individual asset basis. If it is not possible to
estimate the recoverable amount of an individual asset, the recoverable amount of the group of
assets to which the asset belongs is determined. A group of assets is the smallest group of assets
that is able to generate independent cash inflows.
Separately recognised goodwill is tested at least annually for impairment, irrespective of whether
there is any indication that the asset may be impaired. During the test, the carrying value of
goodwill is allocated to the related asset group or groups of asset group which is expected to
benefit from the synergies of the business combination. If the result of the test indicates that the
recoverable amount of an asset group or groups of asset group including the goodwill allocated is
lower than its carrying amount, the corresponding impairment loss is recognized. The impairment
loss is first deducted from the carrying amount of goodwill allocated to the asset group or groups of
asset group, and then deducted from the carrying amount of the remaining assets of the asset
group or groups of asset group pro rata with goodwill.
Once the above asset impairment loss is recognised, it will not be reversed for the value recovered
in the subsequent periods.
- 26 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(21) Employee benefits
Employee benefits mainly include wages or salaries, bonuses, allowances and subsidies, staff
welfare, social security contributions, housing funds, labour union funds, employee education funds
and other expenditures incurred in exchange for service rendered by employees.
The Group has established a pension scheme for employees which is a defined contribution plan.
The Group pays contributions at 5.5% to 6% of employees’ salary into the plan. The Group has no
further obligations once the contributions have been paid. The contributions are recognised as
employee benefit expense when they are due. The pension assets are hold by a trustee and are
managed separately from the Group’s assets.
(22) Dividend distribution
Cash dividend is recognised as a liability for the period in which the dividend is approved by the
shareholders’ meeting.
(23) Revenue recognition
The amount of revenue is determined in accordance with the fair value of the consideration
received or receivable for the sale of services in the ordinary course of the Group’s activities.
Revenue is shown net of discounts and returns.
Revenue is recognised when the economic benefits associated with the transaction will flow to the
Group, the related revenue can be reliably measured, and the specific revenue recognition criteria
have been met for each type of the Group’s activities as described below:
(a) Rendering of services
The Group provides loading/unloading, transportation, logistic agency and other related harbor
services to external customers. Revenue arising from provision of services is re ognised when
services are completed and the amount of revenue and cost can be reliably measured.
(b) Transfer of asset use rights
Interest income is recognised on a time-proportion basis using the effective interest method.
Lease income from an operating lease is recognised on a straight-line basis over the period of the
lease.
- 27 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(24) Government Grants
Government grants are transfers of monetary or non-monetary assets from the government to the
Group at nil consideration, including refund of taxes and financial subsidies, etc.
A government grant is recognised when the conditions attached to it can be complied with and the
government grant can be received. For a government grant in the form of transfer of monetary
assets, the grant is measured at the amount received or receivable. For a government grant in the
form of transfer of non-monetary assets, it is measured at fair value; if the fair value is not reliably
determinable; the grant is measured at nominal amount.
A government grant related to an asset is recognised as deferred income, and evenly amortised to
profit or loss over the useful life of the related asset. Government grants measured at nominal
amounts are recognised immediately in profit or loss for the current period.
For government grants related to income, where the grant is a compensation for related expenses
or losses to be incurred by the Group in the subsequent periods, the grant is recognised as
deferred income, and included in profit or loss over the periods in which the related costs are
recognised; where the grant is a compensation for related expenses or losses already incurred by
the Group, the grant is recognised immediately in profit or loss for the current period.
(25) Deferred revenue
Deferred revenue is the advance from customers which should be amortised on a straight-line
basis over the expected beneficial period and presented at cost net of accumulated amortisation.
(26) Deferred tax assets and deferred tax liabilities
Deferred tax assets and deferred tax liabilities are calculated and recognised based on the
differences arising between the tax bases of assets and liabilities and their carrying amounts
(temporary differences). Deferred tax asset is recognised for the deductible losses that can be
carried forward to subsequent years for deduction of the taxable profit in accordance with the tax
laws. No deferred tax liability is recognised for a temporary difference arising from the initial
recognition of goodwill. No deferred tax asset or deferred tax liability is recognised for the
temporary differences resulting from the initial recognition of assets or liabilities due to a
transaction other than a business combination, which affects neither accounting profit nor taxable
profit (or deductible loss). At the balance sheet date, deferred tax assets and deferred tax liabilities
are measured at the tax rates that are expected to apply to the period when the asset is realised or
the liability is settled.
- 28 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(26) Deferred tax assets and deferred tax liabilities (Con’d)
Deferred tax assets are only recognised for deductible temporary differences, deductible losses
and tax credits to the extent that it is probable that taxable profit will be available in the future
against which the deductible temporary differences, deductible losses and tax credits can be
utilised.
Deferred tax liabilities are recognised for temporary differences arising from investments in
subsidiaries, associates and joint ventures, except where the Group is able to control the timing of
reversal of the temporary difference, and it is probable that the temporary difference will not
reverse in the foreseeable future. When it is probable that the temporary differences arising from
investments in subsidiaries, associates and joint ventures will be reversed in the foreseeable future
and that the taxable profit will be available in the future against which the temporary differences
can be utilised, the corresponding deferred tax assets are recognised.
Deferred tax assets and liabilities are offset when:
the deferred taxes are related to the same tax payer within the Group and the same taxation
authority; and,
that tax payer within the Group has a legally enforceable right to offset current tax assets
against current tax liabilities.
(27) Leases
A finance lease is a lease that transfers substantially all the risks and rewards incidental to
ownership of an asset. An operating lease is a lease other than a finance lease.
Lease payments under an operating lease are recognised on a straight-line basis over the period of
the lease, and are either capitalized as part of the cost of related assets, or charged as an expense
for the current period.
- 29 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
2 Significant accounting policies and accounting estimates (Con’d)
(28) Held for sale and discontinuing operations
A non-current asset or a component of the Group satisfying the following conditions is classified as
held for sale: (1) the Group has made a resolution for disposal of the non-current asset or the
component;(2) an irrevocable contract with the transferee has been signed and;(3) the transfer will
be completed within one year.
Non-current assets, except for financial assets and deferred tax assets, that meet the recognition
criteria for held for sale are included in other current assets at the amount equal to the lower of the
fair value less costs to sell and the carrying amount. Any excess of the original carrying amount
over the fair value less costs to sell is recognised as an asset impairment loss.
Discontinued operation is a component of the Group that either has been disposed of or is
classified as held for sale, and can be distinguished from other components within the Group in the
business operations and in the preparation of financial statements.
(29) Segment information
The Group identifies operating segments based on the internal organisation structure,
management requirements and internal reporting system, and discloses segment information of
reportable segments which is determined on the basis of operating segments.
An operating segment is a component of the Group that satisfies all of the following conditions: (1)
the component is able to earn revenues and incur expenses from its ordinary activities; (2) whose
operating results are regularly reviewed by the Group’s management to make decisions about
resources to be allocated to the segment and to assess its performance, and (3) for which the
information on financial position, operating results and cash flows is available to the Group. If two
or more operating segments have similar economic characteristics and satisfy certain conditions,
they are aggregated into one single operating segment.
(30) Critical accounting estimates and key assumptions
The Group continually evaluates the critical accounting estimates and key judgements applied
based on historical experience and other factors.
There are no critical accounting estimates or key judgments of the Group in current year that will
cause significant adjustments to the book value of assets and liabilities in next year.
- 30 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
3 Taxation
The types and rates of taxes applicable to the Group are set out below.
Type Taxable basis Tax rate
Enterprise income tax Taxable income 16.5%, 24% and 25%
Value added tax (“VAT”) Taxable income from vehicle maintenance and utilities supplies on 17%
ships in shore (tax payable represents output VAT calculated using
the taxable sales amount multiplied by the effective tax rate less
deductible input VAT)
Taxable income from sales of scraps 3%
Taxable income from transfer of fixed asset (tax inclusive) 4% (levied by half)
Business tax Taxable loading/unloading and transportation income 3%
Taxable warehousing, logistic agency and rental income 5%
Urban maintenance and VAT and Business tax paid 5% and 7%
construction tax
Education surplus VAT and Business tax paid 3%
Regional education surplus VAT and Business tax paid 2%
The applicable enterprise income tax rate for the Company and the subsidiaries located in
Shenzhen Special Economic Zone had been 15%. Under the new CIT Law, the CIT income tax
rate applicable to the Company and these subsidiaries will increase gradually to 25% within 5 years
from 2009 to 2012. The applicable income tax rate for 2011 is 24%. (2010: 22%)
The applicable enterprise income tax rate for the subsidiaries located in Dongguan city is 25%.
(2010: 25%)
Chiwan Wharf Holdings (H.K.) Limited (hereinafter “WHK”) and Chiwan Shipping (H.K.) Company
Limited are subject to Hong Kong CIT income tax rate at 16.5% (2010: 16.5%).
For the year ended 31 December 2011, several subsidiaries of the Company are still in the tax
holiday of “5 year exemption and 5 year half reduction”. The details are set out below.
(a) The profit derived from berth #12 of Chiwan Container Terminal Company Limited
(hereinafter “CCT”) is entitled to full exemption from income tax for five years commencing
from its first profit making year and a 50% exemption for the following five years. 2011 is
the eighth profit-making year of berth #12, CIT has been provided at a rate of 12% (2010:
11%).
- 31 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
3 Taxation (Con’d)
(b) The profit derived from berth #13 of CCT is entitled to full exemption from income tax for five years
commencing from its first profit making year and a 50% exemption for the following five years when
certain requirement met. 2011 is the senventh profit-making year of berth #13, CIT has been
provided at a rate of 12% (2010: 11%).
- 32 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
4 Business combination and the consolidated financial statements
(1) Information of subsidiaries
(a) Subsidiaries obtained through incorporation or investment
Registered capital
(in ten thousand
Type of Nature of Yuan unless Legal Organization Type of
Full name of investees subsidiaries Place of registration business otherwise stated) Principal activities Type of enterprise representatives code audit opion Hierarchy
Shenzhen Chiwan International Freight Domestically-funded
Agency Company Limited Direct Shenzhen, PRC Logistics 550 Shipping agency service enterprise Qu Jiandong 61885111-4 standard 1
Shenzhen Chiwan Terminal Company Direct and Shenzhen, PRC Logistics 5,000 Port services Domestically-funded Zhao Qiang 19231989-1
Limited indirect enterprise standard 1
Shenzhen Chiwan Trains-Grains Terminal Direct and Shenzhen, PRC Logistics 4,500 Warehousing of grains Chinese-Foreign Zhang Jianguo 61893398-8
Company Limited indirect equity joint venture standard 1
Chiwan Wharf Holdings (H.K.) Limited Direct Hong Kong SAR, PRC Investments HKD 1,000,000 Shipping agency service Overseas enterprise NA NA standard 1
Dongguan Chiwan Wharf Company Direct and Dongguan, PRC Logistics 45,000 Port services, Chinese-Foreign Wang Fen 79123972-X
Limited indirect warehousing and other equity joint venture
logistic services standard 1
Dongguan Chiwan Terminal Company Direct and Dongguan, PRC Logistics 30,000 Port services, Chinese-Foreign Wang Fen 67307267-4
Limited indirect warehousing and other equity joint venture
logistic services standard 2
Grossalan Investments Limited Direct British Virgin Islands Investments USD 1 Investment holding Overseas enterprise NA NA standard 2
Hinwin Development Company Limited Indirect Hong Kong SAR, PRC Investments HKD 10,000 Investment holding Overseas enterprise NA NA standard 2
- 33 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
4 Business combination and the consolidated financial statements (Con’d)
(1) Information of subsidiaries (Con’d)
(a) Subsidiaries obtained through incorporation or investment (Con’d)
Substantial net investment on the Amount of loss attributed
subsidiaries recorded in other Consolidate Minority to the minority
Name of subsidiaries Year end actual investment items Share holding Voting right or not interests shareholders
Shenzhen Chiwan International Freight Agency Company Limited 5,500,000 - 100% 100% Y - -
Shenzhen Chiwan Terminal Company Limited 50,000,000 - 100% 100% Y - -
Shenzhen Chiwan Trains-Grains Terminal Company Limited 45,000,000 - 100% 100% Y - -
Chiwan Wharf Holdings (H.K.) Limited 1,070,000 11,004,285 100% 100% Y - -
Dongguan Chiwan Wharf Company Limited(i) 382,500,000 - 85% 85% Y 69,668,546 1,497,454
Dongguan Chiwan Terminal Company Limited 300,000,000 - 100% 100% V - -
Grossalan Investments Limited 8 100% 100% Y - -
Hinwin Development Company Limited(Note5(9)) 6,278,500 94,014,181 100% 100% Y - -
790,348,508 105,018,466 69,668,546 1,497,454
- 34 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
4 Business combination and the consolidated financial statements (Con’d)
(1) Information of subsidiaries (Con’d)
(a) Subsidiaries obtained through incorporation or investment (Con’d)
(i) The group previously owned 100% equity interest of Dongguan Chiwan Wharf Company Limited (hereinafter”DGW”). On 16 August 2011, the group
signed an agreement with Yihai Kerry investment Ltd, the Group and Yihai Kerry agreed to inject RMB121,200,000 and RMB 91,940,000
respectively ,to Dongguan Wharf Ltd . After the capital injection, the Group and Yihai Kerry hold 85% and 15% equity of DGW, respectively. On 9
June 2011, the capital injection has been completed and the equity interest owned by the group decreased and was treated as a deemed disposal of
subsidiary‘s equity to minority interests. Of the investment of RMB 91,940,000 by Yihai Kerry, RMB 67,500,000 was recorded as paid in capital, while
RMB 24,440,000 was credited to the capital surplus of DGW. The corresponding portion of the net assets attributable to the group, RMB 20,774,000
is credited to capital surplus – share premium.
- 35 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
4 Business combination and the consolidated financial statements (Con’d)
(1) Information of subsidiaries (Con’d)
(b) Subsidiaries obtained through business combinations involving enterprises under common control
Full name of investees Type of Place of Nature of Registered capital Principal activities Type of enterprise Legal Organization Minority Amount of loss
subsidiaries registration business (in ten thousand Yuan representatives code interests attributed to the
unless otherwise stated) minority
shareholders
Shenzhen Chiwan Harbour Direct and Shenzhen, Logistics 28,820 Container handling and other Chinese-Foreign Zhang Ning 61881729-0 standard 1
Container Company Limited indirect PRC port services Equity joint venture
Shenzhen Chiwan Transportation Direct and Shenzhen, Logistics 1,500 container transportation, Chinese-Foreign Zhang Ning 61883349-3 standard 1
Company Limited indirect PRC vehicle and port machinery Equity joint venture
maintenance
Chiwan Container Terminal Direct and Shenzhen, Logistics USD 95,300,000 Container handling and other Chinese-Foreign Zheng 61881700-4 standard 1
Company Limited indirect PRC port services Equity joint venture Shaoping
Shenzhen Chiwan Shipping and Direct and Shenzhen, Logistics 2,400 Cargo shipping Chinese-Foreign Zhang Ning 61881638-6 standard 1
Transportation Company Limited indirect PRC Equity joint venture
Chiwan Shipping (H.K.) Company Indirect Hong Kong, Logistics HKD 800,000 Shipping agency service Foreign company NA NA standard 2
Limited PRC
- 36 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
4 Business combination and the consolidated financial statements (Con’d)
(1) Information of subsidiaries (Con’d)
(b) Subsidiaries obtained through business combinations involving enterprises under common control (Con’d)
Substantial net
investment on the Voting Amount of loss
Year end actual subsidiaries recorded Interest right held Consolidate attributed to the
Name of subsidiaries investment in other items held (%) (%) d Minority interests minority shareholders
Shenzhen Chiwan Harbour Container Company Limited 250,920,000 - 100% 100% Yes - -
Shenzhen Chiwan Transportation Company Limited 7,000,000 19 100% 100% Yes - -
Chiwan Container Terminal Company Limited 485,990,004 - 55% 55% Yes 568,598,774 -
Shenzhen Chiwan Shipping and Transportation Company
Limited 24,000,000 - 100% 100% Yes - -
Chiwan Shipping (H.K.) Company Limited 856,000 - 100% 100% Yes - -
768,766,004 19 568,598,774 -
All above subsidiaries and the Company had been under common control by Nanshan Group before and after the acquisition.
- 37 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
4 Business combination and the consolidated financial statements (Con’d)
a) Entities newly included in or excluded from the consolidation scope in the current year
Hinwin Development Co.,Ltd is newly included in the consolidation scope in the current
year.(Note5(9)(b))
b) There is no loss of subsidiary due to disposal of shares and loss of control during the year.
c) Exchange rates applied to major financial statement items of the overseas operating entities
Balance Sheet Item Revenue, expense
31 December 2011 31 December 2010 and cash flow item
Chiwan Shipping (H.K.) Company Limited 1HKD = 0.81RMB 1HKD = 0.85RMB Current exchange rate of the
transaction
Grossalan Investments Limited 1HKD = 0.81RMB 1HKD = 0.85RMB Current exchange rate of the
transaction
5 Notes to the consolidated financial statements
(1) Cash at bank and on hand
31 December 2011 31 December 2010
Original Exchange RMB Original Exchange RMB
currency rate equivalent currency rate equivalent
Cash on hand-
RMB - - 9,914 - - 8,829
HKD 71 6.30 447 71 6.62 470
USD 4,535 0.81 3,674 2,557 0.85 2,174
14,035 11,473
Cash at bank-
RMB - - 292,000,350 - - 605,086,621
USD 3,992,510 6.30 25,152,810 1,336,616 6.62 8,848,399
HKD 197,714,953 0.81 160,149,112 196,006,858 0.85 166,605,829
477,302,272 780,540,849
Other cash balances-
RMB - - 1,458,828 - - 1,066,932
USD - 6.30 - 228 6.62 1,509
HKD 17,047 0.81 13,808 116,847 0.85 99,320
1,472,636 1,167,761
478,788,943 781,720,083
- 38 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(2) Notes receivable
31 December 2011 31 December 2010
Bank acceptance notes - 4,640,000
(3) Interest receivable
31 December Current year Current year 31 December
2010 additions decreases 2011
Interest receivables 1,318,202 756,667 (2,023,202) 51,667
There was no interest overdue as at 31 December 2011 and 2010.
(4) Accounts receivable
31 December 2011 31 December 2010
Accounts receivable 230,846,394 179,822,749
Less: provision for bad debts (49,391) (49,994)
230,797,003 179,772,755
(a) The ageing of accounts receivable is analysed below:
31 December 2011 31 December 2010
Within 1 year 230,011,499 179,739,426
1 to 2 years 757,905 -
2 to 3 years - -
Over 3 years 76,990 83,323
230,846,394 179,822,749
- 39 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(4) Accounts receivable (Con’d)
(b) Accounts receivable are analysed by categories as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of total Provision for % of % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
With amounts that are 180,326,499 78% - - 135,313,207 75% - -
individually significant and
that the related provision for
bad debts is provided on the
individual basis
Others 50,519,895 22% (49,391) 0.1% 44,509,542 25% (49,994) 0.1%
230,846,394 100% (49,391) 0.02% 179,822,749 100% (49,994) 0.03%
The management classified the five largest accounts receivable as “with amounts that are
individually significant”.
(c) As at 31 December 2011, receivables that are individually significant and impaired are analysed as
follows:
Provision for % of the balance and
Amount bad debt reason of impairment
Customer A 113,368,915 - Not applicable
Customer B 34,286,640 - Not applicable
Customer C 12,679,079 - Not applicable
Customer D 12,621,655 - Not applicable
Customer E 7,370,210 - Not applicable
180,326,499 -
- 40 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(4) Accounts receivable (Con’d)
(d) The aging analysis of the receivables that are grouped and impaired is as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of
% of total Provision for % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
Within 1 year 49,685,000 21.52% - - 44,426,219 24.71% - -
1 to 2 years 757,905 0.33% - - - - - -
Over 3 years 76,990 0.03% (49,391) 64% 83,323 0.05% (49,994) 60%
50,519,895 21.88% (49,391) 0.1% 44,509,542 24.76% (49,994) 0.1%
(e) As at 31 December 2011, no balances included in above accounts receivable are due from the
shareholders of the Company who hold over 5% voting rights (31 December 2010: Nil).
(f) As at 31 December 2011, the Group’s five largest accounts receivable balances are analysed as
follows:
Relationship % of total accounts
with the Group Amount Duration receivable balance
Customer A Third party 113,368,915 Within 1 year 49.11%
Customer B Third party 34,286,640 Within 1 year 14.85%
Customer C Third party 12,679,079 Within 1 year 5.49%
Customer D Third party 12,621,655 Within 1 year 5.47%
Customer E Third party 7,370,210 Within 1 year 3.19%
180,326,499 78.11%
- 41 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(4) Accounts receivable (Con’d)
(g) Accounts receivable due from related parties are analysed as follows:
31 December 2011 31 December 2010
Provision Provision
Relationship with the % of total for bad % of total for bad
Group Amount balance debts Amount balance debts
Shenzhen Southsea Grains Notes 7(4) 1,368,092 0.59% - 110,521 0.06% -
Industries Limited (“Southsea
Grains”)
Shenzhen Mawan Port Co., Ltd. Notes 7(4) 682,266 0.30% - 998,942 0.56% -
(“SMP”)
China Overseas Harbor Affairs Notes 7(4) 539,724 0.23% - - - -
(Laizhou) Co.Ltd
China Merchant Bonded Notes 7(4) 378,384 0.16% - 344,900 0.19% -
Logistics )Co.,Ltd(“CMBL”)
Shenzhen Mawan Wharf Co, Notes 7(4) 335,669 0.15% - 397,090 0.22% -
Ltd.(“SMW”)
Shekou Container Terminals Notes 7(4) 6,500 0.00% - 907,600 0.50%
Limited(“SCT”)
Shenzhen Nantian Oil Dregs Notes 7(4) - - - 562,957 0.31% -
Industry Co., Ltd.
3,310,635 1.43% - 3,322,010 1.84% -
(h) The following accounts receivable are denominated in foreign currencies:
31 December 2011 31 December 2010
Original Exchange RMB Original Exchange RMB
currency rate equivalent currency rate equivalent
USD 4,882,828 6.30 30,761,816 4,025,498 6.62 26,648,794
HKD 936,003 0.81 758,163 1,551,068 0.85 1,318,408
31,519,979 27,967,202
- 42 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(5) Other receivables
31 December 2011 31 December 2010
Current accounts with counterparties 7,100,207 49,746,197
Deposits 2,940,003 2,427,356
Staff advances 1,554,108 1,066,432
Others 489,912 736,021
12,084,230 53,976,006
Less: Provision for bad debts (250,353) (1,210,645)
11,833,877 52,765,361
(a) The ageing of other receivables is analysed below:
31 December 2011 31 December 2010
Within 1 year 11,127,183 52,147,049
1 to 2 years 455,276 158,164
2 to 3 years 9,603 418,316
3 to 4 years 279,544 475,805
4 to 5 years 88,996 130,563
Over 5 years 123,628 646,109
12,084,230 53,976,006
(b) Other receivables are analysed by categories as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of total Provision for % of % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
With amounts that are
individually significant
and that the related
provision for bad
debts is provided on
the individual basis 5,707,787 47.23% - - 47,492,149 87.99% (520,000) 1.09%
Receivables that are
grouped and provided for
bad debt 6,376,443 52.77% (250,353) 3.93% 6,483,857 12.01% (690,645) 10.65%
12,084,230 100% (250,353) 2.07% 53,976,006 100% (1,210,645) 2.24%
- 43 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(5) Other receivables (Con’d)
(c) As at 31 December 2011, other receivables with amounts that are individually significant and that
the related provision for bad debts is provided on the individual basis are analysed as follows:
Provision for
Book amount bad debts % of balance Reason
CMBL 2,622,178 - - N/A
SMW 898,479 - - N/A
Finacial Secretary of Transport Ministry 800,000 - - N/A
Deposits of non-vessel carrier 797,040 - - N/A
Maxtop 590,090 - - N/A
5,707,787 -
(d) Other receivables that the related provision for bad debts is provided on grouping basis using the
ageing analysis method are analysed as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of % of
total Provision for % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
Within 1 year 5,419,396 44.85% - - 4,778,114 8.85% - -
1 to 2 years 455,276 3.77% (45,528) 10.00% 158,164 0.29% (15,816) 10.00%
2 to 3 years 9,603 0.08% (2,881) 30.00% 418,316 0.78% (83,663) 20.00%
Over 3 years 492,168 4.07% (201,944) 41.03% 1,129,263 2.09% (591,166) 52.35%
6,376,443 52.77% (250,353) 3.93% 6,483,857 12.01% (690,645) 10.65%
(e) As at 31 December 2011, no balances in other receivables from shareholders holding more than
5% (including 5%) of the voting rights of the Company (31 December 2010: Nil).
- 44 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(5) Other receivables (Con’d)
(f) As at 31 December 2011, the five largest other receivables are analysed as follows:
Relationship with the % of total accounts
Group Amount Duration receivable balance
CMBL Associate of the Group 2,622,178 Within 1 year 21.70%
SMW Associate of the Group 898,479 Within 1 year 7.44%
Finacial Secretary of Transport Ministry Third party 800,000 Within 1 year 6.62%
Deposits of non-vessel carrier Third party 797,040 Within 1 year 6.60%
Maxtop Third party 590,090 Within 1 year 4.87%
5,707,787 47.23%
(g) Other receivables due from related parties are analysed as follows:
31 December 2011 31 December 2010
% of total % of total
Relationship accounts Provision for accounts Provision for
with the Group Amount receivables bad debt Amount receivables bad debt
CMBL Notes 7(4) 2,622,178 21.70% - 57,821 0.11% -
SMW Notes 7(4) 898,479 7.44% - 79,083 0.15% -
Shenzhen Xuqin Industrial
Development Co., Ltd.(“Xuqin”) Notes 7(4) 320,000 2.65% (192,000) 320,000 0.59% (192,000)
SMP Notes 7(4) 308,451 2.55% - 20,961 0.04% -
China Petroleum Supply Base Co.,
Ltd. (“CPSB”) Notes 7(4) 135,622 1.12% - 135,622 0.25% -
SCT Notes 7(4) 187,102 1.55% - - - -
China Merchants International Cold Notes 7(4)
Chain (Shenzhen) Company
Limited(“CMICL”) 48,645 0.40% - - - -
Media Port Investment Limited Notes 7(4) - - - 44,879,120 83.15% -
4,520,477 37.41% (192,000) 45,492,607 84.29% (192,000)
- 45 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(5) Other receivables (Con’d)
(h) The following other receivables are denominated in foreign currencies:
31 December 2011 31 December 2010
Original Exchange RMB Original Exchang RMB
Foreign currency currency rate equivalent currency e rate equivalent
USD 102,836 6.30 647,867 125,650 6.62 831,801
HKD 378,355 0.81 306,468 196,519 0.85 167,041
954,335 998,842
(6) Advance to suppliers
(a) The ageing of advance to suppliers is analysed below;
31 December 2011 31 December 2010
% of total % of total
Amount balance Amount balance
Within 1 year 3,497,668 100% 31,256,172 100%
(b) Advances to suppliers are analysed by categories as follows:
Category 31 December 2011 31 December 2010
Insurance Fee 1,631,823 2,307,558
Decoration Fee 1,210,724 -
Software Maintenance Expense 496,389 853,833
Prepayment for Equipment 142,232 539,245
Consultancy and Advisory Fee 16,500 -
Prepayment for materials - 75,536
Prepayment for facility - 27,480,000
3,497,668 31,256,172
- 46 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(6) Advance to suppliers(Con’d)
(c) As at 31 December 2011, the Group’s five largest advance to suppliers balances are analysed as
follows:
% of total
Relationship advance to Time of
with the Group Amount suppliers prepayment Unsettled reason
The People’s Insurance Company (Group) Third party 1,387,879 39.68% Year 2011 Relevant goods or services
of China Limited were not provided
Shenzhen Zhong Zhuang Design and Third party 1,070,724 30.61% Year 2011 Relevant goods or services
Decoration Engineering CO.,Ltd were not provided
Ruechengda Information and Technology Third party 496,389 14.19% Year 2011 Relevant goods or services
Co., Ltd were not provided
China Continent Property & Casualty Third party 243,945 6.97% Year 2011 Relevant goods or services
Insurance Co., Ltd. Shenzhen Branch were not provided
Mettler Toledo (Changzhou) Weighting Third party 119,833 3.43% Year 2011 Relevant goods or services
Equipment System Co.,Ltd were not provided
3,318,770 94.88%
(d) As at 31 December 2011, no balances of advance to shareholders holding more than 5% (including
5%) of the voting rights of the Company (31 December 2010: Nil).
(e) As at 31 December 2011, no balances of advance to suppliers were with related parties (31
December 2010: Nil).
(7) Inventories
(a) Inventories by categories are analysed as follows:
31 December 2011 31 December 2010
Provision for Provision for
declines in the declines in
value of Net book the value of Net book
Cost inventories value Cost inventories value
Spare parts 23,198,355 (792,118) 22,406,237 26,001,106 (3,396,128) 22,604,978
Fuel 1,062,721 - 1,062,721 1,281,346 - 1,281,346
Low value consumables 31,400 - 31,400 2,202 - 2,202
24,292,476 (792,118) 23,500,358 27,284,654 (3,396,128) 23,888,526
- 47 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(7) Inventories(Con’d)
(b) Movement of inventories is analysed as follows:
31 December 31 December
2010 Additions Less 2011
Spare parts 26,001,106 42,244,566 (45,047,317) 23,198,355
Fuel 1,281,346 50,228,677 (50,447,302) 1,062,721
Low value consumables 2,202 29,198 - 31,400
27,284,654 92,502,441 (95,494,619) 24,292,476
(c) Book value of inventories by age are analysed as follows:
Within 1 year 1 to 2 years 2 to 3 years Over 3 years Total
Spare parts 20,442,307 264,406 52,561 1,646,963 22,406,237
Fuel 1,062,721 - - - 1,062,721
Low value consumables 31,400 - - - 31,400
21,536,428 264,406 52,561 1,646,963 23,500,358
(d) Provision for declines in the value of inventories is analysed as follows:
31 December Current year 31 December
2010 provisions Current year decreases 2011
Reversals Written-off
Spare parts (3,396,128) (792,118) 103,512 3,292,616 (792,118)
(e) Details about provision for declines in the value of inventories is as follows:
% of current year reversals to
Basis of provision Reason of current year reversals stock yearend balance
Spare parts Net realizable value lower than the
book value of spare parts Net realizable value increased 14%
- 48 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(8) Available-for-sale financial assets
31 December 2011 31 December 2010
Available-for-sale equity investments 5,690,000 6,640,000
Available-for-sale financial asset represented 1,000,000 PRC legal person shares of Jiangsu
Expressway (the “Jiangsu Expressway”) held by the Company. As at 31 December 2011 the
market value of the stocks in Shanghai Stock Exchange per the closing market price of the last
trading day of year 2011 was RMB 5,690,000. Fair value change of RMB 767,700 has been
debited d to capital surplus.
(9) Long-term equity investments
31 December 2011 31 December 2010
Joint ventures (a) 795,776,215 763,011,159
Associates (b)
- Without quoted price 627,171,005 373,001,527
Other long-term equity investment 17,037,500 17,037,500
1,439,984,720 1,153,050,186
Less: Provision for impairment of long-term equity
investments (c) (3,128,300) (3,128,300)
1,436,856,420 1,149,921,886
As at 31 December 2011, the long-term equity investments of the Group were not subject to
restriction on disposal or remittance of return on investments.
- 49 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated and the Company’s financial statements (Con’d)
(9) Long-term equity investments (Con’d)
(a) Joint venture
Current year additions / decreases
Explanation of Provision
Share of net disparity between for
Initial Increase/ profit using Cash Other Share Voting percentages of Provision impairment
Accounting investment 31 December Decrease in the equity dividend changes in 31 holding rights share holding and for made in
method cos 2010 investment method declared equity December 2011 (%) (%) voting rights impairment current year
China Overseas Harbour Equity
Affairs (Laizhou) Co., Ltd method 749,655,300 763,011,159 - 32,665,056 - 100,000 795,776,215 40.00% 40.00% Not applicable
* According to the investment agreement with shareholders of China Overseas Harbour Affairs (Laizhou) Co., Ltd (hereinafter “COHA(Laizhou)”)and its
constitutions, significant affairs in its business operation can only be effective when approved by directors of Chiwan Wharf, therefore COHA(Laizhou) is
deemed to be under common control of Chiwan Wharf and its other shareholders, accordingly COHA(Laizhou) is accounted for as a joint-venture.
- 50 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated and the Company’s financial statements (Con’d)
(9) Long-term equity investments (Con’d)
(b) Associates
Current year additions / decreases
Share of net Cash Reason of Provision Provision
Initial profit or loss dividends Other 31 inconsistent for for impairment
Accounting investmen 31 December Additional of announced equity December Interest Voting interest % and impairment made in current
method t cost 2010 investment associates by associates changes 2011 % right % voting right balance year
Shenzhen Cyber-
harbour Network Co.,
Ltd.(“Cyber Equity
Network”) method 1,875,000 12,869,241 - 19,885 (1,224,863) - 11,664,263 23.16% 23.16% Not applicable - -
Equity
CMBL method 280,000,000 66,766,772 220,284,181 3,983,566 - 1,764,925 292,799,444 40.00% 40.00% Not applicable - -
Equity
MPIL* method 139,932 293,365,514 - 77,299,676 (47,957,892) - 322,707,298 50.00% 50.00% Not applicable - -
373,001,527 220,284,181 81,303,127 (49,182,755) 1,764,925 627,171,005 - -
* On 29 January 2010, the company signed agreement on transfer of shareholding to sell 20% shareholding of CMBL at a price of RMB94,000,000.The
relevant income on disposal had been recorded in the income statement of year 2010.
In 2011,in consideration of the good development prospects of CMBL brought by develop plan of Qianhai,Shenzhen,the company decided to increase the
shareholding of CMBL and later, further increase the investment in it.. As at 28 April 2011, Excel Steps Limited, WHK, a wholly owned subsidiary of the
Company and the company signed an agreement of transfer in shareholding. WHK paid to Excel Steps Limited around RMB 6.27 million to obtain 100%
shareholdings of Hinwin Development Co.,Ltd,and undertook advances from shareholder of Excel Steps Limited amounting around 94million.Hinwin has
no other business except holding 20% shares of CMBL, and the company deemed this substance of the transaction is to buy in 20% shareholding of CMBL,
so that the transaction is dealt as purchase of 20% shareholding of CMBL. After above transaction, the company has 40% equity interest of CMBL directly
and indirectly.
- 51 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated and the Company’s financial statements (Con’d)
(9) Long-term equity investments (Con’d)
(b) Associates(Con’d)
In May 2011, all shareholdings of CMBL agreed add 300 million in its registered capital to RMB 700 million. The investment of the company reached 120
million by shareholding portion.
** The company has 50% equity of MPIL ,but no control power on it,so it is treated as joint –venture.
On 30 September 2002, China Merchants Holdings (International) Company Limited (the “CMHI”, a listed company in Hong Kong) and Shenzhen South Oil
(Group) Company Limited (the “SSOG”) entered into an agreement called the “Agreement on Cooperation and Development of Mawan Port” (the
“Development Agreement”) to incorporate three joint ventures, namely SMW, SMP and Shenzhen Mawan Terminals Co., Ltd. (“SMT”) (together referred to
as “Mawan Companies”), to construct and operate the berth 0#, 5#, 6#, 7# and 8# in Mawan Port.
According to the Development Agreement, CMHI and the Group will incorporate an associated corporation (Note 5 (10)) Media Port Investments Limited
(the “MPIL”) first with equal percentage of equity held respectively. MPIL then incorporates the abovementioned three joint ventures together with SSOG,
at 60% and 40% equity interest therein respectively. So the actual shareholdings held by the group is 30%.
- 52 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(9) Long-term equity investments (Con’d)
(c) Other long-term equity investment
Reason of Provision
Initial Current year inconsistent Provision for impairment Current year
Accounting investment 31 December additions / 31 December Interest Voting interest % and for impairment made in declared cash
method cost 2010 decreases 2011 % right % voting right balance current year dividend
China Ocean Shipping Agency Cost
(Shenzhen) Company Limited method 13,510,000 13,510,000 - 13,510,000 15% 15% Not applicable - - 3,900,000
Shenzhen Petro-chemical Industry Cost
(Group) Company Limited. method 3,500,000 3,500,000 - 3,500,000 0.26% 0.26% Not applicable (3,117,800) - -
Guangdong Guang Jian Group Cost
Company Limited method 27,500 27,500 - 27,500 0.02% 0.02% Not applicable (10,500) - -
17,037,500 - 17,037,500 (3,128,300) - 3,900,000
(d) Provision for impairment of long-term equity investments
Current year Current year
31 December 2010 additions decreases 31 December 2011
Other long-term equity investment
-Shenzhen Petro-chemical Industry (Group) Company Limited 3,117,800 - - 3,117,800
-Guangdong Guang Jian Group Company Limited 10,500 - - 10,500
3,128,300 - - 3,128,300
- 53 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(10) Investment in joint ventures and associates
The particular of the associates are set out as below.
Voting right
Interest held held 31 December 2011 2011
Total assets Total liabilities Net assets Operating revenue Net profit / (loss)
Joint venture –
China Overseas Harbour Affairs
(Laizhou) Co., Ltd 40% 40% 2,021,464,420 222,811,236 1,798,653,184 295,054,110 81,662,641
Associates –
China Merchants Holdings (international)
information technology company Ltd 23.16% 23.16% 67,154,387 14,432,954 52,721,433 49,463,049 85,857
CMBL 40% 40% 1,463,544,741 821,152,514 642,392,227 155,265,661 8,558,366
HKD HKD HKD HKD HKD
MPIL 50% 50% 2,864,082,877 2,051,524,901 812,557,976 740,675,739 294,159,648
All above summary financial information of the joint venture and associates are extracted from their statutory financial statements or management accounts.
The Group has applied the accounting policy of the Group to the results of the joint venture and associates in equity accounting of the share of results of
the joint venture and associates.
- 54 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(11) Investment properties
31 December Current year Current year 31 December
2010 additions decreases 2011
Cost totals 50,658,833 20,013,200 (5,643,895) 65,028,138
Buildings / properties 19,149,868 20,013,200 (5,643,895) 33,519,173
Land use right 31,508,965 - - 31,508,965
Accumulated depreciation / amortization
totals 21,279,289 13,450,693 (4,381,073) 30,348,909
Buildings / properties 8,234,247 12,836,928 (4,381,073) 16,690,102
Land use right 13,045,042 613,765 - 13,658,807
Book value totals 29,379,544 34,679,229
Buildings / properties 10,915,621 - - 16,829,071
Land use right 18,463,923 - - 17,850,158
In 2011, investment properties depreciation / amortization was RMB 1,333,628 (2010:
RMB907,104).
In 2011, the previously self-occupied properties with net book value RMB7,896,135 (Cost of RMB
20,013,200) was leased out in current year, and therefore, such assets were transferred from fixed
assets and intangible assets to investment properties at the dates of transfers.
As at 31 December 2011 and 2010, none of the investment properties have obtained Building and
Land Ownership Certificate. Please refer to Note 5(14) for the reason and measures taken by
management.
- 55 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(12) Fixed assets
31 December Current year Current year 31 December
2010 additions decreases 2011
Cost totals 4,236,465,750 55,779,529 (99,746,790) 4,192,498,489
Harbor facilities 1,315,344,468 - (53,411,199) 1,261,933,269
Warehouses, container yards and
buildings 700,915,560 6,052,460 (18,828,976) 688,139,044
Machinery and equipments 1,874,315,547 23,659,364 (19,836,000) 1,878,138,911
Motor vehicles, cargo ships and
tugboats 254,367,036 7,766,065 (3,742,341) 258,390,760
Other equipments 91,523,139 18,301,640 (3,928,274) 105,896,505
Accumulated depreciation totals 1,522,787,834 163,911,032 (36,973,446) 1,649,725,420
Harbor facilities 227,871,832 23,808,959 (9,537,665) 242,143,126
Warehouses, container yards and
buildings 199,385,996 17,880,342 (2,826,222) 214,440,116
Machinery and equipments 907,292,082 103,727,083 (17,722,680) 993,296,485
Motor vehicles, cargo ships and
tugboats 120,599,575 12,841,279 (3,338,307) 130,102,547
Other equipments 67,638,349 5,653,369 (3,548,572) 69,743,146
Net book amount totals 2,713,677,916 - - 2,542,773,069
Harbor facilities 1,087,472,636 - - 1,019,790,143
Warehouses, container yards and
buildings 501,529,564 - - 473,698,928
Machinery and equipments 967,023,465 - - 884,842,426
Motor vehicles, cargo ships and
tugboats 133,767,461 - - 128,288,213
Other equipments 23,884,790 - - 36,153,359
Provision for impairment loss totals 60,720,001 - (24,620) 60,695,381
Harbor facilities - - - -
Warehouses, container yards and
buildings 60,695,381 - - 60,695,381
Machinery and equipments - - - -
Motor vehicles, cargo ships and
tugboats 24,620 - (24,620) -
Other equipments - - - -
Net book value totals 2,652,957,915 - - 2,482,077,688
Harbor facilities 1,087,472,636 - - 1,019,790,143
Warehouses, container yards and
buildings 440,834,183 - - 413,003,547
Machinery and equipments 967,023,465 - - 884,842,426
Motor vehicles, cargo ships and
tugboats 133,742,841 - - 128,288,213
Other equipments 23,884,790 - - 36,153,359
- 56 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(12) Fixed assets (Con’d)
(*) In 2007, the Group planned to relocate part of the general cargo business and facilities to
Dongguan Machong Port, and made certain impairment provision of certain demolition for related
warehouses, container yards and buildings accordingly. As at 31 December 2011, the management
of the Group considered that impairment provision against the fixed assets were sufficient.
Depreciation charge in 2011 amounted to RMB159,529,959 (2010: RMB176,972,348). In 2011,
depreciation expenses of RMB152,093,367 (2010: RMB169,300,333) and RMB7,436,592 (2010:
RMB7,672,015) were charged to cost of revenue and general and administrative expenses,
respectively.
Fixed assets amounted to RMB28,732,683(2010: RMB618,336,145) were transferred from
construction in progress in current year.
The cost of property,plant and equipment decreases 45,442,208 in the final accounts of the
completed project (2010:Nil).
(a) Temporary idle fixed assets
As at 31 December 2011, buildings, machinery and equipment with a net book amount of
approximately RMB880,313 (cost: RMB32,206,668) were temporary idle (31 December 2010: net
book amount: RMB1,994,990 (cost: RMB28,738,184)), due to that management has not
designated their usage. Details are as follows:
Accumulated Net book
Cost depreciation Impairment amount
Warehouses, container yards and buildings 32,206,668 (28,050,442) (3,275,912) 880,314
Management is of the view that such idle fixed assets are expected to put into use in the future, or
the recoverable amount is larger than the net book value, thus no impairment provision is needed.
(b) Fixed assets with ownership certificates to be obtained
As at 31 December 2011, ownership certificates of buildings (“Buildings and Land Ownership
Certificates”) for certain buildings of the Group with net book value of approximately
RMB128,884,046 (cost: RMB199,086,043) had not yet been obtained (31 December 2010:
carrying amount: RMB62,095,750 (cost: RMB128,793,948). For fixed assets with which book value
of RMB32,361,834 (cost: RMB94,487,309), please refer to Note 5(14) for the reason and response
from management and the rest is on the process of getting ownership certificates.
- 57 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(13) Construction in progress
31 December 2011 31 December 2010
Provision for Net Provision for Net
Book value impairment book value Book value impairment book value
Berth 4#-5#, Machong Port 169,264,280 - 169,264,280 7,222,455 - 7,222,455
Berth 2#-3#, Machong Port 118,802,890 - 118,802,890 - - -
Berth Extension 106,442,864 - 106,442,864 1,380,600 - 1,380,600
Quay-crane Construction 65,250,000 - 65,250,000 - - -
Tug Construction 33,384,070 - 33,384,070 5,060,834 - 5,037,371
Cantry Crane 16,600,000 - 16,600,000 - - -
Others 8,074,040 - 8,074,040 929,627 - 953,090
517,818,144 - 517,818,144 14,593,516 - 14,593,516
- 58 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(13) Construction in progress (Con’d)
(a) Movement of significant construction in progress
Transfer to % of Percent Accumulated Borrowing
fixed assets actual age of capitalised cost Weighted
Budget 31 December Current year during the Other 31 December cost to completi borrowing capitalised average
Name of projects 2010 additions current year reduction 2011 budget on cost In 2011 interest rate Sources of fund
Berth 4#-5#, Machong Self Funding
Port 816,975,300 7,222,455 162,041,825 - - 169,264,280 20.72% 20.72% - - -
Berth 2#-3#, Machong Self Funding and loan
Port 331,850,000 - 118,802,890 - - 118,802,890 35.80% 35.80% 432,996 432,996 5.90%
Berth Extension Project 140,930,000 1,380,600 105,062,264 - - 106,442,864 75.53% 75.53% - - - Self Funding
Quay-crane Construction 130,500,000 - 65,250,000 - - 65,250,000 50% 50% - - - Self Funding
Tug Construction 38,000,000 5,060,834 28,323,236 - - 33,384,070 87.85% 87.85% 1,035,653 1,001,874 5.90% Self Funding and loan
CTOS System 19,049,993 - 19,049,993 16,164,993 2,885,000 - 100.00% 100.00% - - - Self Funding
Cantry Crane 135,200,000 - 24,050,000 7,450,000 - 16,600,000 12.28% 12.28% - - - Self Funding
Others 13,215,192 929,627 12,262,103 5,117,690 - 8,074,040 61.10% 61.10% - - - Self Funding
14,593,516 534,842,311 28,732,683 2,885,000 517,818,144 1,468,649 1,434,870
- 59 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(13) Construction in progress (Con’d)
(b) As at 31 December 2011, the progresses for significant constructions are analysed as below:
Progress Notes
Berth 4# - 5#, Machong Port 20.72% Progress is estimated based on actual percentage completion
Berth 2# - 3#, Machong Port 35.80% Progress is estimated based on actual percentage completion
Berth Extension Project 75.53% Progress is estimated based on actual percentage completion
- 60 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(14) Intangible assets
31 December Current year Current year 31 December
2010 additions reductions 2011
Original cost totals 1,531,257,503 3,205,000 - 1,534,462,503
Land use rights – prepaid under lease (a) 1,419,159,549 - - 1,419,159,549
Land use rights– purchased 19,343,189 - - 19,343,189
Computer software 19,868,628 3,205,000 - 23,073,628
Coastal line use rights 72,886,137 - - 72,886,137
Accumulated amortization totals 457,009,684 38,525,927 - 495,535,611
Land use rights – prepaid under lease (a) 436,282,005 35,762,109 - 472,044,114
Land use rights– purchased 1,456,075 386,864 - 1,842,939
Computer software 17,763,788 748,954 - 18,512,742
Coastal line use rights 1,507,816 1,628,000 - 3,135,816
Net book value totals 1,074,247,819 - - 1,038,926,892
Land use rights – prepaid under lease (a) 982,877,544 - - 947,115,435
Land use rights– purchased 17,887,114 - - 17,500,250
Computer software 2,104,840 - - 4,560,886
Coastal line use rights 71,378,321 - - 69,750,321
In 2011, the amortisation of intangible assets amounted to RMB38,525,927(2010: RMB37,797,684).
(a) Group has leased from Nanshan Group several plots of land with a total area of 779,254 sq.
meters within Chiwan port for a lease term of 20 - 50 years with up-front payments of RMB
684,453,783 made. The lands were injected by Shenzhen Investment Holding Corporation in 1982
as part of the consideration in acquiring the equity interests of Nanshan Group. As the PRC laws
prevailing at that time did not provide for a mechanism for the issuance of official certificates of the
land use rights, Nanshan Group has not obtained the land use right certificates of the leased land
so far.
In June 2003 and September 2004, CCT entered into a land use agreement with Nanshan Group
and leased two plots of land, one with an area of 117,827.2 square meters for 40.5 years and the
other with an area of 171,089.478 square meters for 39 years, at the consideration of RMB
271,002,558 and RMB 444,832,643 respectively. Also no official certificates for such lands were
obtained by Nanshan Group. Correspondingly, the buildings located on such lands have not
obtained relevant real estate certificates.
- 61 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(14) Intangible assets(Con’d)
In March 2001,June 2003 and September 2004,Nanshan Group committed on all the land use right
obtained by the group from it: Nanshan Group has no right to withdraw and will agree in any
condition that ,when the group suffer loss ,bear expense and liability, be claimed to compensation
or run into lawsuit, caused by any actually or potentially illegal and unconductable issues generated
by land use right agreements and their relevant documents, signed or will be signed by Nanshan
Group,Nanshan group will guarantee that the acquiring party and its inheritor of those land use
right will be fully exempted from above issues mentioned.
Based on the situations above, directors of the company believed there is no significant impairment
risk will be caused by the absence of land use right certificate and no significant contingency exist.
The company learned that Nanshan Group is active in process of resolve the historical problem
with relevant government department, however it cannot predict the exact time of obtaining
relevant legal certificates.
(15) Goodwill
31 December Current year Current year 31 December
2010 additions decreases 2011
CCT 10,858,898 - - 10,858,898
The goodwill arose from the acquisition of the minority interests in CCT, being the difference of the
additional cost of investment and the Group’s share of the fair value of the identifiable net assets in
CCT.
(a) Impairment
Goodwill allocated to the asset groups or compositions of asset groups of the Group at impairment
tests are summarized by operating segments as follows:
31 December 2011 31 December 2010
Loading and unloading business -
Mainland China 10,858,898 10,858,898
The recoverable amount of the asset groups and compositions of asset groups was determined
according to the 5-year budget approved by the management, and calculated per cash flow
forecasts. Estimated growth rate in cash flow above this 5-year was calculated as follows.
- 62 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(15) Goodwill (Con’d)
Major assumptions applied in the future cash flow forecast method:
Loading and unloading
business – Mainland China
Growth rate 0%
Gross margin 48%
Discount rate 13.2%
The weighted average growth rate that management adopted is consistent with forecasts in
relevant industry analysis reports, and did not exceed the long-term average growth rate of various
services. Management developed a budgeted gross profit margin according to experience and
forecast in market development, as well as the pre-tax interest rate that can reflect the specific risk
of relevant asset group or combination of asset group, as discount rate. Such assumptions are
applied to analyse the asset group or combination of asset group within relevant operating segment.
(16) Long-term prepaid expenses
Residual
31 December Current year Current year Other 31 December useful
2010 additions amortisations decreases 2011 Original Cost Period
Construction expenditure
of Tonggu sea-route (a) 59,026,284 - (1,844,573) - 57,181,711 64,560,000 31 years
Foresea packing ground 3,624,552 - (1,208,184) - 2,416,368 5,537,510 2 years
Golf membership 710,553 1,380,000 (193,922) - 1,896,631 2,443,549 1-10 year
Building decoration 486,800 - (142,978) - 343,822 510,630 3-5 years
Others - 650,000 - 650,000 650,000 5 years
63,848,189 2,030,000 (3,389,657) - 62,488,532 73,701,689
(a) In 2007, the Shenzhen municipal government commenced the construction work of the public
sea route connecting Tonggu sea route, Shekou port area, Chiwan port area, Mawan port area,
Qianhaiwan port area and Dachanwan port area (“Tonggu Sea Route”). As required by a
decision by the government, 60% of construction expenditure would be allocated to the port
operators while the remaining 40% born by the government. The port operators in Western
Shenzhen port areas were allocated 35% of the total expenditure, and subsequently agreed the
portion to each operator, taking into accounts of the factors including the function, waterfront
length, berthing ship of each porter etc. The total expenditure of RMB 64,560,000 were allocated
to the Group and accounted for as Long term prepaid expenses, being amortized on a straight
line basis over 35 years which is the expected useful live of Tonggu Sea Route starting from
2008 when the Tonggu Sea Route was ready for use.
- 63 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(17) Other non-current assets
31 December 2011 31 December 2010
Coast Line Use Right(a) 36,375,000 33,000,000
Land use right(a) 85,463,860 39,292,214
Prepayment of facility 20,269,424 -
142,108,284 72,292,214
(a) In March 2006, the Company entered into the agreement of “Frame contract for cooperation
on usage of quay and land for berth 2# & 5# at Machong Port in Dongguan” and its
supplement with Dongguan Humen Port Administration Commission to purchase a land with
an area of 800,000 square meters and area of water with depth of 700 meters from the front of
terminal, together with the use right of 1,200 meters coast line, for berth 2# to berth 5# in
Dongguan Machong Port at a consideration of RMB 260,000,000. Up to 31 December 2011,
the Company has paid the first four installments of the consideration. As the Group has not
obtain the land use right certificate, the relevant payments were therefore recognized as other
non-current assets.
(18) Deferred tax assets and deferred tax liabilities
(a) Deferred tax assets before offsetting
31 December 2011 31 December 2010
Deductible Deductible
temporary temporary
Deferred tax difference Deferred tax difference
assets and losses assets and losses
Provision for asset impairment 15,130,592 61,677,792 15,485,248 65,587,348
Depreciation of fixed assets and amortization of
intangible assets 11,836,540 47,424,834 12,495,066 50,145,172
Deductible losses 19,205,338 82,041,588 14,580,112 67,326,990
Accrued expenses 10,686,955 45,492,841 6,162,977 28,134,252
Pre-operational expenses 1,390,282 8,088,918 1,390,282 9,100,033
Others 2,114,419 9,444,637 1,969,977 8,757,878
60,364,126 254,170,610 52,083,662 229,051,673
- 64 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(18) Deferred tax assets and deferred tax liabilities(Con’d)
(b) Deferred tax liabilities before offsetting
31 December 2011 31 December 2010
Deferred tax Taxable temporary Deferred tax Taxable temporary
liabilities difference liabilities difference
Depreciation of property plant
and equipment and amortization
of intangible assets 1,113,207 4,452,828 - -
Change in fair value of available
for sale equity financial assets
recorded in capital surplus 1,142,500 4,570,000 1,324,800 5,520,000
2,255,707 9,022,828 1,324,800 5,520,000
(c) Deferred tax assets and deferred tax liabilities after offsetting
31 December 2011 31 December 2010
Deductible Deductible
Deferred tax temporary difference Deferred tax temporary difference
assets and losses assets and losses
Provision for impairmen 15,130,592 61,677,792 15,485,248 65,587,348
Depreciation of property plant
and equipment and amortization
of intangible assets 10,723,333 42,972,006 12,495,066 50,145,172
Deductible loss 19,205,338 82,041,588 14,580,112 67,326,990
Accrual Expense 10,686,955 45,492,841 6,162,977 28,134,252
Preliminary organization costs 1,390,282 8,088,918 1,390,282 9,100,033
Others 2,114,419 9,444,637 1,969,977 8,757,878
59,250,919 249,717,782 52,083,662 229,051,673
31 December 2011 2010 年 12 月 31 日
Deductible Deductible
Deferred tax temporary difference Deferred tax temporary difference
liabilities and losses liabilities and losses
Change in fair value of available
for sale financial asset credited
in capital surplus 1,142,500 4,570,000 1,324,800 5,520,000
- 65 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(18) Deferred tax assets and deferred tax liabilities(Con’d)
(d) Analysis about deductible temporary differences and losses that the Group did not recognise
deferred tax assets for is as follows:
31 December 2011 31 December 2010
Deductible losses 8,573,918 5,170,629
Deductible temporary differences - -
8,573,918 5,170,629
(e) The above deductible losses that no deferred tax assets have been provided for will expire in the
following years:
31 December 2011 31 December 2010
2013 83,654 83,654
2014 379,817 379,817
2015 4,707,158 4,707,158
2016 3,403,289 -
8,573,918 5,170,629
(19) Provision for impairment of assets
31 December Current year 31 December
2010 addition Current year reduction 2011
Reverse Utilized Foreign
exchange
translation
differences
Bad debt provisions 1,260,639 43,949 (481,481) (520,000) (3,363) 299,744
Bad debt provision for accounts
receivable 49,994 1,794 - - (2,397) 49,391
Bad debt provision for other receivable 1,210,645 42,155 (481,481) (520,000) (966) 250,353
Provision for declines in the value of
inventories(Note 5(7)) 3,396,128 792,118 (103,512) (3,292,616) - 792,118
Include: Spare parts 3,396,128 792,118 (103,512) (3,292,616) - 792,118
Provision for impairment of long-term
equity investments (Note 5(9)) 3,128,300 - - - - 3,128,300
Provision for impairment of fixed assets
(Note 5(12)) 60,720,001 - - (24,620) - 60,695,381
Include: Harbor facilities - - - - - -
Warehouses, container yards and
buildings 60,695,381 - - - - 60,695,381
Machinery and equipments - - - - - -
Motor vehicles, cargo ships and
tugboats 24,620 - - (24,620) - -
Other equipments - - - - - -
68,505,068 836,067 (584,993) (3,837,236) (3,363) 64,915,543
- 66 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(20) Short-term borrowings
31 December 2011 31 December 2010
Bank loans - unsecured 1,418,830,000 1,225,550,000
The above bank loans consisted of 250,000,000 denominated in RMB (31 December 2010:
390,000,000) and1,443,000,000 denominated in HKD (31 December 2010: 983,000,000), the latter
is equivalent to RMB1,168,830,000 (31 December 2010: 835,550,000).
Included in short-term borrowings was loan of HKD160,000,000(RMB:129,000,000), which should
be due over one year according to the loan contract, however it is reclassified as short-term
borrowings on the grounds that the loan contracts contain the clause that the bank can recall the
loan before the maturity at the bank’s sole discretion.
As at 31 December 2011, the weighted average interest rate of the short-term borrowings was
4.62% per annum (2010: 3.68%).
Outstanding borrowings in maturity: Nil
(21) Notes payable
31 December 2011 31 December 2010
Bank acceptance notes 8,704,900 1,895,750
As at 31 December 2011, RMB8,704,900 had an expected maturity within 1 year (31 December
2010: RMB1,895,750).
(22) Accounts payable
31 December 2011 31 December 2010
Construction amounts payable 117,153,230 160,673,611
Service amounts payable 21,681,108 20,810,343
Material purchase amounts payable 17,550,367 23,131,022
Rental payables 1,632,036 5,238,273
Machinery procurement amounts payable 2,096,213 4,870,002
160,112,954 214,723,251
(a) As at 31 December 2011, the Group did not have any accounts payable balances which were due
to parties having 5% or above voting rights in the Company except for the amount due to Nanshan
Group below. (31 December 2010: nil).
- 67 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(22) Accounts payable (Con’d)
(b) Accounts payable due to related parties:
31 December 2011 31 December 2010
Shenzhen Haiqin Engineering Supervision Co. Ltd.
(“Haiqin Engineering”) 5,062,227 9,972,227
Nanshan Group 5,002,068 8,583,552
China Merchant Information Technology 1,302,441 -
Xuqin 319,058 1,760,479
Nantian Youpo 163,201 202,361
11,848,995 20,518,619
(c) As at 31 December 2011, accounts payable with aging over 1 year amounting to RMB 32,535,258
(31 December 2010: RMB148,390,794) were mainly payable for construction and project
management services. As the related construction projects have not been completed yet, the
accounts have not been settled. Up to the approval date of these financial statements,
RMB18,713,587 was paid.
(d) The following accounts payable balances are denominated in foreign currency:
31 December 2011 31 December 2010
Original Exchange RMB Original Exchange RMB
currency rate equivalent currency rate equivalent
USD 8,072 6.30 50,854 7,433 6.62 49,208
HKD 1,536,872 0.81 1,244,866 1,359,449 0.85 1,155,532
1,295,720 1,204,740
- 68 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(23) Advances from customers
31 December 2011 31 December 2010
Service fee receipt in advance 5,045,311 4,769,320
(a) The ageing of accounts payable based on their recording dates is analysed as follows:
31 December 2011 31 December 2010
Amount Ratio Amount Ratio
Within 1 year 5,029,561 100% 3,668,636 77%
1-2 year - 0% 1,068,996 22%
2-3 year - 0% - 0%
Over 3 years 15,750 0% 31,688 1%
5,045,311 100% 4,769,320 100%
(b) As at 31 December 2011, the Group did not have any advance from customers balances which
were due to parties having 5% or above shareholdings in the Company (31 December 2010: Nil).
(c) As at 31 December 2011, no balances of advance from customers were from related parties (31
December 2010: Nil).
(d) As at 31 December 2011, advance from customers with ageing over 1 year amounting to RMB
15,750 is advances for sale of cars (31 December 2010:Service fee 1,100,684).
- 69 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(24) Employee benefits payable
31 December Current year Current year 31 December
2010 additions reductions 2011
Wages and salaries, bonuses, allowances and
subsidies 27,253,030 184,667,138 (165,987,517) 45,932,651
Staff welfare - 13,177,167 (13,177,167)
Social security contributions 10,256 17,209,398 (17,209,802) 9,852
Including: Medical insurance - 4,291,869 (4,291,869) -
Basic pension - 11,816,176 (11,816,176) -
Unemployment insurance - 275,826 (275,826) -
Employment injury insurance 10,256 421,126 (421,530) 9,852
Generational insurance - 404,401 (404,401) -
Defined contribution plan * 125,952 6,633,738 (6,759,690) -
Housing funds 11,810 12,292,617 (12,304,427) -
Labor union and employee education funds 9,528,864 7,033,389 (6,558,889) 10,003,364
Others - 174,065 (174,065) -
36,929,912 241,187,512 (222,171,557) 55,945,867
* On 3 June 2008, the Group participated in a group defined contribution plan of Nanshan Group
approved by Shenzhen government. The above pension contributions were paid into the plan
through Nanshan Group.
As at 31 December 2011, employee benefits payable balance did not include default items (31
December 2010: Nil).
Pursuant to the resolution of 2010 general meeting of shareholders on 27 May 2011, the
management team will be granted a performance reward scheme based on the current year net
profit and yearly net asset return ratio. The Company has provided RMB14,917,004 of
management reward in 2011 (2010: RMB4,674,654), which was debited to general and
administrative expenses.
- 70 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(25) Taxes payable
Item 31 December 2010 Provided in current year Paid in current year 31 December 2011
Enterprise income tax
payable 69,788,458 147,855,729 (125,163,204) 92,480,983
Withholding tax payable 23,736,008 15,489,047 (18,652,247) 20,572,808
Business tax payable 4,834,815 62,892,685 (62,461,075) 5,266,425
Value-added-tax payable 95,738 3,579,446 (3,533,266) 141,918
Others 2,128,501 34,792,349 (33,601,934) 3,318,916
100,583,520 264,609,256 (243,411,726) 121,781,050
(26) Interest payable
31 December 2011 31 December 2010
Interest payable for long-term borrowings that
interests are payable by installment and principal
at maturity 1,088,956 769,567
Interest payable for short-term borrowings 548,834 2,188,839
1,637,790 2,958,406
(27) Dividends payable
31 December 2011 31 December 2010
Payable to International Enterprise Co., Ltd. 207,726,574 121,367,360
Payable to Hidoney Developments Co., Ltd. 157,434,877 91,983,683
365,161,451 213,351,043
As at 31 December 2011, the balances were payable to the minority shareholders of CCT, one of
the subsidiaries of the Company, being dividends declared for 2011.
- 71 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(28) Other payables
31 December 2011 31 December 2010
Temporary receipts 19,065,981 14,143,124
Security expense payable 17,101,361 16,713,645
Audit fee payable 2,610,000 1,680,000
Deposits received 1,720,908 1,944,902
Service fees 1,407,531 951,137
Due to employees 1,225,285 819,218
Insurance indemnity 955,433 1,386,919
Due to Nanshan Group - 28,278
Others 6,722,794 7,360,583
50,809,293 45,027,806
(a) The ageing of accounts payable based on their recording dates is analysed as follows:
31 December 2011 31 December 2010
Amout Ratio Amout Ratio
Within 1 year 44,356,691 87.30% 36,592,085 81.27%
1-2 year 2,583,466 5.08% 4,959,509 11.01%
2-3 year 3,067,152 6.04% 653,201 1.45%
Over 3 years 801,984 1.58% 2,823,011 6.27%
50,809,293 100% 45,027,806 100%
(b) The largest balance in other payables aging over 3 years:
Creditor Amout Reason for non-settle
China National Agricultural means of Production
Co., (Shenzhen) Ltd 62,334 Business deposit
Shenzhen West Lake Huayu transportation Ltd. 40,482 Business deposit
Rongtai (Hongkong) Ltd 36,825 Business deposit
139,641
- 72 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(28) Other payables(Con’d)
(c) The large amount of balance in other payables:
Creditor Amount Reason for non-settle
Yaran Business Trade Co.,Ltd 3,047,323 Deposit
CMBL 2,001,792 Receipts under custody
SMW 945,521 Receipts under custody
Beijing Yongshengfeng AMP Co.,Ltd 782,645 Receipts under custody
PICC Property and Casualty Co.,Ltd 675,075 Temporary receipts
7,452,356
(d) As at 31 December 2011, the Group did not have any other payables which were due to parties
having 5% or above shareholdings in the Company.
(e) Other payables due to related parties:
31 December 2011 31 December 2010
CMBL 2,001,792 49,540
SMW 945,521 2,961,451
China Merchants International Cold Chain
(Shenzhen)Co.,Ltd(“CMICCL”) 64,200 253,800
SMP 31,963 20,894
COCL - 110,881
Nanshan Group - 48,304
3,043,476 3,444,870
- 73 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(28) Other payables (Con’d)
(f) As at 31 December 2011, other payables with aging over 1 year amounting to RMB6,452,602 (31
December 2010: RMB8,435,721) are mainly deposits. As the relevant business keeps running, the
amounts have not been settled. Up to the approval date of these financial statements, RMB
147,075 was paid.
(g) The following other payable balances are dominated in foreign currency:
31 December 2011 31 December 2010
Original Exchange RMB Original Exchange RMB
currency rate equivalent currency rate equivalent
USD 210,606 6.30 1,326,818 533,500 6.62 3,531,770
HKD 720,320 0.81 583,459 327,518 0.85 278,390
1,910,277 3,810,160
(29) Current portion of non-current liabilities
31 December 2011 31 December 2010
Current portion of long-term borrowings (a) 10,000,000 408,000,000
Current portion of deferred revenue(Note 5(32)) 4,951,750 4,951,750
14,951,750 412,951,750
(a) Current portion of long-term borrowings
31 December 2011 31 December 2010
Bank borrowings - unsecured 10,000,000 408,000,000
As at 31 December 2011, the balance of current portion of long- term borrowings represented the
borrowing of 100,000,000 by the DGW.
- 74 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(29) Current portion of non-current liabilities(Con’d)
Top five current portion of long-term borrowings:
Borrowing
beginning Borrowing ending Currency Interest rate (%) 31 December 2011 31 December 2010
Original RMB Original RMB
currency equivalent currency equivalent
Nanyang Commercial Bank 21 October 2011 21 April 2012 RMB 7.2450% - 5,000,000 - -
Nanyang Commercial Bank 21 October 2011 21 October 2012 RMB 7.2450% - 5,000,000 - -
10,000,000 -
(30) Long-term borrowings
31 December 2011 31 December 2010
Bank borrowings - unsecured(a) 90,000,000 -
(a) Top five long-term borrowing
Borrowing beginning Borrowing ending Currency Annual interest rate 31 December 2011
Original currency RMB equivalent
Nanyang
Commercial Bank 21 October 2011 21 October 2016 RMB 7.2450% - 90,000,000
(b) Long-term borrowings are repayable as follows:
31 December 2011 31 December 2010
1 to 2 years 20,000,000 -
2 to 3 years 20,000,000 -
3 to 4 years 25,000,000 -
Over 4 years 25,000,000 -
90,000,000 -
The weighted average interest rate of the long-term borrowings in 2011 was 7.2450% per annum.
- 75 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(30) Long-term borrowings(Con’d)
(c) Undrawn committed borrowing facilities
The Group has the following undrawn committed borrowing facilities as at 31 December 2011:
Expiring within 1 year 2,777,520,100
Expiring in 1 to 2 years 413,700,000
Expiring in 2 to 3 years 100,000,000
Over 3 years 100,000,000
3,391,220,100
The undrawn committed borrowing facilities mentioned above would be used for the commitment
capital expenditure (Note 9).
(31) Special Payables
31 December 2011 31 December 2010
Refunds of Harbor Construction Fee 81,790,541 69,119,645
The item is refunds of harbor construction fee to the company and its subsidiary CCT from
Shenzhen traffic bureau. According to
released by Ministry of Finance, the fund should be managed in separate account and can be only
used on fundamental facilities’ construction of marine transportation.
(32) Other non-current liabilities
31 December 2011 31 December 2010
Deferred revenue
- Business Contract (a) 50,250,957 57,841,707
- Government grant related to asset (b) 8,000,000 8,000,000
58,250,957 65,841,707
- 76 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(32) Other non-current liabilities(Con’d)
(a) Business Contract
31 December 2010
- the portion of current liabilities 4,951,750
- the portion of non-current liabilities 57,841,707
62,793,457
Current year reduction (7,590,750)
Less: the portion of current liabilities (4,951,750)
31 December 2011 50,250,957
Residual useful years 12-13 years
Deferred revenue is amortised on a straight-line basis over the expected beneficial period of 20
years and is presented at cost net of accumulated amortisation.
(b) Government grant related to asset
The item is government subsidies received which based on (NDRC[2010] No.1263). The total received amount is 8
million yuan. As at 31 December 2011, the assets under government grant have not reached its
intended condition for use, therefore the grant has not been credit to income statement.
- 77 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(33) Share capital
31 December 2010 Current year additions / decreases 31 December 2011
Shares converted
Issuance of Presented from accumulation
new shares shares fund Others Sub-total
Shares with restriction on disposal -
State shares -
PRC legal person shares -
Other domestic shares 673,252 - - - 117,677 117,677 790,929
Including: Domestic shares of legal person
other than the State -
Natural person shares 673,252 - - - 117,677 117,677 790,929
Foreign shares -
Including: Foreign legal person shares -
Natural person shares -
673,252 - - - 117,677 117,677 790,929
Shares without restriction on disposal -
Common shares in RMB 464,789,805 - - - - - 464,789,805
Domestically listed foreign shares 179,300,673 - - - (117,677) (117,677) 179,182,996
644,090,478 - - - (117,677) (117,677) 643,972,801
644,763,730 - - - - - 644,763,730
Up to 31 December 2011, all the shares held by Nanshan Group have become tradable.
- 78 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(33) Share capital (Con’d)
31 December 2009 Current year additions / decreases 31 December 2010
Shares converted
Issuance of Presented from accumulation
new shares shares fund Others Sub-total
Shares with restriction on disposal -
State shares - - - - - - -
PRC legal person shares - - - - - - -
Other domestic shares 361,942 - - - 311,310 311,310 673,252
Including: Domestic shares of legal person
other than the State - - - - - - -
Natural person shares 361,942 - - - 311,310 311,310 673,252
Foreign shares - - - - - - -
Including: Foreign legal person shares - - - - - - -
Natural person shares - - - - - - -
361,942 - - - 311,310 311,310 673,252
Shares without restriction on disposal -
Common shares in RMB 464,789,805 - - - - - 464,789,805
Domestically listed foreign shares 179,611,983 - - - (311,310) (311,310) 179,300,673
644,401,788 - - - (311,310) (311,310) 644,090,478
644,763,730 - - - - - 644,763,730
- 79 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(34) Capital surplus
31 December Current year Current year 31 December
2010 additions reductions 2011
Share premium 142,786,083 20,774,000 - 163,560,083
Other capital surplus—
Change in fair value of available-for-sale
financial assets
- Total (Note 5(8)) 5,520,000 (950,000) - 4,570,000
- Deferred tax liabilities (Note 5(18)) (1,324,800) 182,300 - (1,142,500)
Transfer from the balance of capital surplus -
recognised under previous accounting
system (a) (2,781,133) (2,781,133)
Others 709,605 1,310,000 - 2,019,605
144,909,755 21,316,300 - 166,226,055
31 December Current year Current year 31 December
2009 additions reductions 2010
Share premium 142,786,083 - - 142,786,083
Other capital surplus—
Change in fair value of available-for-sale
financial assets
- Total 6,020,000 (500,000) - 5,520,000
- Deferred tax liabilities (1,324,400) (400) - (1,324,800)
Transfer from the balance of capital surplus -
recognised under previous accounting
system (a) (2,781,133) - (2,781,133)
Others 709,605 - - 709,605
145,410,155 (500,400) - 144,909,755
(a) Balances of capital surplus recognized under previous accounting system mainly include:
- During 2003 to 2005, the Group provided shareholder’s loan of RMB 100,000,000 to Mawan
companies. According to related circular CK(2001)64 regarding accounting treatment of
sales of assets between related parties issued by the Ministry of Finance, that part of interest
received that exceeded the market interest rate of RMB 7,124,745 was recorded in capital
surplus.
- On 1 January 2006, CCT changed its recording currency from Hong Kong dollar to Renminbi
yuan. According to the relevant PRC regulations, the exchange differences arising from
translation of foreign capital and other equity accounts are recorded in capital surplus. The
Group debited the portion of CCT’s capital and other equity accounts of RMB 10,086,842,
calculated based on the proportion of equity interest the Group held in CCT, to capital
surplus.
- 80 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(35) Surplus reserve
31 December Current year Current year 31 December
2010 additions reductions 2011
Statutory surplus reserve 383,570,404 38,122,001 - 421,692,405
31 December Current year Current year 31 December
2009 additions reductions 2010
Statutory surplus reserve 355,134,736 28,435,668 - 383,570,404
In accordance with the Company Law and the Company’s Articles of Association, the Company
should appropriate 10% of net profit for the year to the statutory surplus reserve, the Company can
cease appropriation when the statutory surplus reserve accumulated to more than 50% of the paid
in capital. The statutory surplus reserve can be used to make up for the loss or increase the paid in
capital after approval.
The Company appropriates discretionary surplus reserve after shareholders’ meeting approves the
Board of Director’s proposal. The discretionary surplus reserve can be used to make up for the loss
or increase the paid in capital after approval.
Pursuant to the board resolution, the Company appropriates 10% of net profit to statutory surplus
reserve, namely RMB38,122,001 (2010: RMB28,435,668), no appropriation to discretionary
reserve is provided.
(36) Retained earnings
2011 2010
Amount Appropriate or Amount Appropriate or
distribution % distribution %
Opening retained earnings 2,079,724,472 1,721,028,196 -
Add: Current year net profit attributable to the
equity owners of the parent company 505,645,137 596,680,156 -
Less: Appropriation of statutory reserves (38,122,001) 10% (28,435,668) 10%
Common share dividends payable (298,525,607) 50% (209,548,212) 52%
Closing retained earnings 2,248,722,001 2,079,724,472
As at 31 December 2011, included in the undistributed profits, the amount of RMB480,610,213 is
subsidiaries’ surplus reserve attributable to the Company (31 December 2010: RMB466,088,790),
among which RMB14,521,423 is appropriated for the current year (2010: RMB3,770,941).
- 81 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(36) Retained earnings (Con’d)
In accordance with a resolution at the Board of Directors meeting dated 27 May 2011, the Board of
Directors proposed dividend of RMB 4.63 for each 10 shares of the issued shares of 644,763,730
in total, with an aggregated amount of RMB 298,525,607 (2010 proposed: RMB209,548,212).
In accordance with a resolution at the Board of Directors meeting dated 27 March 2012, the Board
of Directors proposed dividend of RMB 4.00 for each 10 shares of the issued shares of
644,763,730 in total, with an aggregated amount of RMB257,905,492 (Notes10 (2)).
(37) Minority interests
31 December 2011 31 December 2010
DGW (a) 69,668,546 -
CCT 568,598,774 567,608,774
638,267,320 567,608,774
(a) Disposal of minority interests in subsidiary：
The group previously owed 100% share holding of Dongguan Chiwan Wharf Company Limited
(hereinafter”DGW”). On 16 August 2011, the group signed an agreement with Yihai Kerry
investment Ltd on injecting RMB121,200,000 and RMB 91,940,000 respectively to Dongguan
Wharf Ltd , after the capital increment ,the two companies hold 85% and 15% shares of
respectively.
The adjustment of minority interest caused by the transaction:
Amount
Sale Price for disposal 91,940,000
minus：Definable Net Assets of subsidiary at date of sale in disposed
shareholding portion 71,166,000
(20,774,000)
- 82 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(38) Revenue and cost of sales
2011 2010
Revenue from main operations 1,643,676,918 1,689,239,347
Revenue from other operations 64,459,981 51,178,321
1,708,136,899 1,740,417,668
2011 2010
Cost of main operations 755,262,540 733,036,517
Cost of other operations 12,777,703 9,275,767
768,040,243 742,312,284
(a) Revenue and cost from main operations
Analysis by business is as follows:
2011 2010
Revenue from Cost from main Revenue from Cost from main
main operations main operations
operations operations
Loading and unloading services 1,533,687,860 711,255,321 1,575,316,865 693,184,030
Transportation service 142,968,604 87,821,197 149,785,299 84,433,056
Agency and others services 10,834,432 - 8,717,752 -
Elimination (43,813,978) (43,813,978) (44,580,569) (44,580,569)
1,643,676,918 755,262,540 1,689,239,347 733,036,517
Analysis by geographic area is as follows:
2011 2010
Revenue from Revenue from
main Cost from main main Cost from main
operations operations operations operations
Mainland China 1,638,111,180 755,262,540 1,685,000,221 733,036,517
Hong Kong 5,565,738 - 4,239,126 -
1,643,676,918 755,262,540 1,689,239,347 733,036,517
- 83 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(38) Revenue and cost of sales (Con’d)
(b) Other revenue and cost
2011 2010
Revenue from Cost from other Revenue from Cost from other
other operations other operations operations
operations
Lease income 26,452,734 3,654,601 15,654,965 2,673,804
Security fee 10,611,941 - 11,856,003 -
Other logistic services in port 13,921,382 5,801,214 10,140,896 3,555,939
Agency fee 5,180,097 3,177,303 4,960,494 3,046,024
Sales of material 2,683,075 144,585 2,730,088 -
Documentation fee 824,376 - 842,875 -
Others 4,786,376 - 4,993,000 -
64,459,981 12,777,703 51,178,321 9,275,767
(c) Particulars of revenue from the top five customers of the Group
Revenue from the top 5 customers with aggregate amount of RMB913,272,542 (2010:
RMB1,090,436,082) accounted for 53% (2010: 63%) of the Group’s total revenue in 2011. Details
are as follows:
% of total revenue
Revenue of the Group
Customer A 446,537,825 26%
Customer B 285,008,042 17%
Customer E 73,176,762 4%
Customer D 62,447,925 4%
Customer C 46,101,988 2%
913,272,542 53%
- 84 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(39) Tax and surcharges
2011 2010 Accrual basis
Business tax 62,892,685 62,374,157 See Note 3
City maintenance and construction tax 4,436,377 731,586 See Note 3
Educational surcharge 3,161,517 149,706 See Note 3
Others 531,347 560,478
71,021,926 63,815,927
(40) General and administration expenses
2011 2010
Staff cost 91,079,683 66,594,327
Utilities and property management 9,417,395 8,599,865
Depreciation and amortisation 9,643,838 8,521,716
Transportation 7,508,789 7,598,288
Rental 7,193,101 7,555,060
Entertainment 7,186,572 6,091,931
Professional service 5,702,284 4,737,435
Communication 3,527,336 3,313,128
Insurance 3,496,523 3,213,913
Decoration and maintenance 4,348,328 3,119,985
Others 9,082,383 11,435,400
158,186,232 130,781,048
(41) Financial (income)/expenses - net
2011 2010
Interest expenses - Interests on borrowings 64,084,834 30,028,539
Less:borrowing costs capitalised (1,434,870) (630,105)
Less: interest income (7,893,831) (6,185,020)
Exchange gains or losses (47,009,755) (36,000,167)
Others 4,624,603 2,251,248
12,370,981 (10,535,505)
Exchange gains are mainly caused by borrowings in HKD.
- 85 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(42) Investment income
2011 2010
Investment income from investments under cost
method accounting 3,900,000 -
Investment income from investments under equity
method accounting (Note 5 (9)) 113,968,183 118,437,391
Loss from disposal of long-term investment (Note 5
(10)) - 29,767,257
Income from available-for-sale financial assets 360,000 310,000
118,228,183 148,514,648
There is no significant restriction in receipt in remittance for investment income.
(a) Investment income from long-term equity investments under cost method accounting
Investment income from top five investees or individually accounted to over 5% of total profit are
analysed as below:
2011 2010 Reason of fluctuation
China Ocean Shipping Agency The investee did not distribute profit to
(Shenzhen) Company Limited 3,900,000 - shareholders in last year
(b) Investment income from long-term equity investments under equity method of accounting
Investment income from top five investees or individually accounted to over 5% of total profit are
analysed as below:
2011 2010 Reason of fluctuation
Investee affected by economic crisis and
MPIL 77,299,676 105,275,424 shrunk in performance
Newly joint venture last year and investment
COHA(Laizhou) 32,665,056 13,355,859 income is the portion of net profit
Investee decline in performance and the
Cyber Network 19,885 379,477 Group decreased the interest
Investee run into operation and its
CMBL 3,983,566 (573,369) circumstance turns better
113,968,183 118,437,391
- 86 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(43) Impairment (reversals) / losses
2011 2010
Impairment losses for bad debts (437,532) 119,061
Impairment losses on inventories 688,606 -
251,074 119,061
(44) Non-operating income
2011 2010
Gain on disposal of non-current assets 70,951 2,161,989
Including: disposal of intangible assets - -
disposal of fixed assets 70,951 2,161,989
Government grant (a) - 1,200,000
Others 1,807,586 1,650,981
1,878,537 5,012,970
(a) Details of government grants
2011 2010
Subsidy in environmental conservancy project - 1,200,000
(45) Non-operating expenses
2011 2010
Losses on disposal of non-current assets 1,960,173 2,834,944
Including: disposal of fixed assets 1,960,173 2,834,944
Donation 52,603 41,025
Penalty 6,311 50,239
Others 16,775 111,282
2,035,862 3,037,490
- 87 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(46) Income tax expenses
2011 2010
Current income tax 155,728,890 145,570,999
Deferred income tax (7,167,257) (7,795,382)
148,561,633 137,775,617
The reconciliation from income tax calculated based on applicable tax rate and total profit
presented in the consolidated financial statements to the income tax expenses is as follows:
2011 2010
Profit before income tax 816,337,301 964,414,981
Income tax calculated at the applicable tax rate of
24% (2010: 22%) 195,920,952 212,171,296
Effect of tax holidays (27,965,504) (54,492,896)
Income not subject to tax (28,374,764) (26,124,426)
Effect of different tax rate in other tax jurisdictions (244,303) (98,472)
Tax losses for which no deferred income tax asset
was recognised 1,003,459 1,021,650
Withholding tax (a) 5,475,267 3,186,747
Costs and expenses not deductible for tax purposes 2,746,526 2,111,718
Income tax expenses 148,561,633 137,775,617
(a) Withholding income tax was accrued at the rate of 5% or 10% for dividend payable to WHK for the
year ended 31 December 2011, declared by those Group’s PRC subsidiaries of which WHK is a
shareholder (2010: 5% or 10%).
- 88 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(47) Government grants
Year 2011 Year 2010
Government grants related to assets
Grants subject to projects - 8,000,000
Government grants related to income - -
others - 1,200,000
Total - 9,200,000
Less：government grants credited in deferred income - (8,000,000)
Government grants credited in current year profit - 1,200,000
(48) Borrowing cost
Name of Project Capitalisation rate Capitalisation amount
Berth 2#-3#, Machong Port 5.90% 432,996
Tug Construction 5.90% 1,001,874
(49) Earning per share
(a) Earnings per share - basic
Basic earning’s per share is calculated by dividing the profit attributable to shareholders of the
Company by the weighted average number of ordinary shares in issue during the year.
2011 2010
Consolidated profit attributable to shareholders of
the Company 505,645,137 596,680,156
Weighted average number of ordinary shares in
issue 644,763,730 644,763,730
Basic earnings per share 0.784 0.925
Includes:
- Basic earnings per share from continuing 0.784 0.925
operations:
(b) Earnings per share - diluted
The Company had not potential dilutive outstanding equity instruments issued as at 31 December
2011 and 2010, accordingly the diluted earnings per share are the same as the basic ones.
- 89 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(50) Other comprehensive income
2011 2010
Gain/(loss) arising from available-for-sale financial
assets (950,000) (500,000)
Less: Income tax relating to available-for-sale financial
assets 182,300 (400)
Subtotal (767,700) (500,400)
Other movement of investee ‘s equity 100,000 -
Exchange differences arising from translating foreign
operations (188,137) (65,242)
(855,837) (565,642)
(51) Notes to consolidated cash flow statements
(a) Cash received relating to other operating activities
2011 2010
Refunds of Harbour Construction Fee received 16,945,741 14,118,115
Intrest income 10,471,718 7,980,981
Government grant - 9,200,000
Others 4,306,623 -
31,724,082 31,299,096
(b) Cash paid relating to other operating activities
2011 2010
Port expenses 8,502,729 7,677,052
Asset insurance fee 4,930,868 4,069,361
Car expenses 7,186,027 4,357,001
Office expenses & utilities 5,929,709 4,291,630
Entertainment expenses 7,133,610 3,210,974
Consulting & auditing fee 5,916,908 2,111,299
Travel & accommodation 2,606,213 1,978,316
Advertisements & exhibition expense 199,798 1,073,401
Others 35,445,572 45,266,431
77,851,434 74,035,465
- 90 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
5 Notes to the consolidated financial statements (Con’d)
(52) Notes to consolidated cash flow statements
(c) Reconciliation from the net profit to the cash flows from operating activities
2011 2010
Net profit 667,775,668 826,639,364
Add: (Provisions for)/reversal of assets impairment 251,074 119,061
Depreciation of fixed assets 159,529,959 176,972,348
Depreciation/amortisation of investment property 1,333,629 907,104
Amortisation of intangible assets 38,525,927 37,797,684
Amortisation of long-term prepaid expenses 3,389,657 5,670,179
Gains on disposal of fixed assets and intangible
assets 1,889,222 672,955
Finance expenses 24,358,158 35,455,170
Investment income (118,228,183) (148,514,648)
Increase in deferred tax assets (7,167,257) (7,795,382)
Decrease in inventories 388,168 1,727,780
Increase in operating receivables (44,983,485) (44,539,627)
Increase in operating payables 19,128,059 41,733,581
Net cash flows from operating activities 746,190,596 926,845,569
Net increase/(decrease) in cash and cash equivalents
2011 2010
Cash at end of year 478,788,943 781,720,083
Less: cash at beginning of year (781,720,083) (741,096,267)
Net increase/(decrease) in cash (302,931,140) 40,623,816
(d) Cash and cash equivalents
31 December 2011 31 December 2010
Cash
Including: Cash on hand 14,035 11,473
Cash at bank without restriction 477,302,272 780,540,849
Other cash balance without restriction 1,472,636 1,167,761
Cash and cash equivalents at end of year 478,788,943 781,720,083
- 91 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
6 Segment information
The reportable segments of the Group are the business units that provide different products or
service, or operate in the different areas. Different businesses or areas require different
technologies and marketing strategies, the Group, therefore, separately manages the production
and operation of each reportable segment and evaluates their operating results respectively, in
order to make decisions about resources to be allocated to these segments and to assess their
performance.
The Group identified 3 reportable segments namely loaded and unloaded operation, transportation
and agency service and other services respectively.
The management of the Company identifies reviews the group internal reports regularly in order to
assess their performance and make decisions of resources being allocated to the segment, which
is the foundation of the Group identifying operation segments.
Inter-segment transfers are measured by reference to sales to third parties.
The assets are allocated based on the operations of the segment and the physical location of the
asset. The liabilities are allocated based on the operations of the segment. Expenses indirectly
attributable to each segment are allocated to the segments based on the proportion of each
segment’s revenue.
- 92 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
6 Segment information (Con’d)
(a) Segment information as at and for the year ended 31 December 2011 is as follows:
Load and unload Agency service
operation Transportation and others Unallocated Elimination Total
Revenue from external customers 1,593,390,668 98,569,821 16,176,410 - - 1,708,136,899
Inter-segment revenue 43,813,978 (43,813,978) -
Interest income 2,022,624 9,659 8,483 5,853,065 7,893,831
Interest expenses (27,647,058) - - (35,002,906) (62,649,964)
Share of profit of associates and joint venture 109,964,732 - 4,003,451 - - 113,968,183
Asset impairment loss (311,118) 103,511 (4,866) (38,601) (251,074)
Depreciation and amortisation (190,060,623) (10,786,817) (1,931,732) - - (202,779,172)
Total profit 809,488,083 42,059,094 14,305,472 (49,515,348) - 816,337,301
Income tax expenses (141,911,349) (10,234,500) (1,042,067) 4,626,283 - (148,561,633)
Net profit 667,576,734 31,824,594 13,263,405 (44,889,065) - 667,775,668
Total assets 5,914,266,259 169,470,410 318,072,314 159,002,508 (20,583,056) 6,540,228,435
Total liabilities 810,813,884 141,682,106 20,103,242 1,482,148,188 (20,583,056) 2,434,164,364
Long-term equity investments in associates and
joint ventures 1,118,483,513 - 304,463,707 - - 1,422,947,220
Additions to non-current assets other than long-
term equity investments 527,608,220 30,148,735 125,170 736,600 - 558,618,725
- 93 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
6 Segment information (Con’d)
(b) Segment information as at and for the year ended 31 December 2010 is as follows:
Load and unload Agency service
operation Transportation and others Unallocated Elimination Total
Revenue from external customers 1,622,708,221 105,204,730 12,504,717 - - 1,740,417,668
Inter-segment revenue - 44,580,569 - - (44,580,569) -
Interest income 639,364 16,371 5,079 5,524,206 - 6,185,020
Interest expenses (16,294,750) - - (13,103,684) - (29,398,434)
Share of profit of associates and joint venture 118,631,283 - 29,573,365 - - 148,204,648
Asset impairment loss (121,014) 26,074 357 (24,478) - (119,061)
Depreciation and amortisation (205,179,714) (13,884,683) (2,282,918) - - (221,347,315)
Total profit 887,726,998 54,012,318 36,876,265 (14,200,600) - 964,414,981
Income tax expenses (129,288,292) (11,670,014) 152,243 3,030,446 - (137,775,617)
Net profit 758,438,706 42,342,304 37,028,508 (11,170,154) - 826,639,364
Total assets 5,910,654,715 209,352,779 100,523,714 16,112,144 (34,458,610) 6,202,184,742
Total liabilities 855,227,841 57,401,450 9,504,879 1,507,351,350 (34,458,610) 2,395,026,910
Non-cash expenses other than depreciation
and amortisation - - - - - -
Long-term equity investments in associates
and joint ventures 1,056,376,673 - 79,636,013 - - 1,136,012,686
Additions to non-current assets other than
long-term equity investments 109,674,428 5,689,454 258,032 91,791 - 115,713,705
- 94 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
6 Segment information (Con’d)
The Group’s revenue from external customers of Mainland China and other countries or
geographical areas for the year 2011, and the total non-current assets other than financial assets
and deferred tax assets located in the Mainland China and other countries or geographical areas
as at 31 December 2011 are as follows:
Revenue from external customers 2011 2010
Mainland PRC 1,702,381,921 1,735,981,253
Hong Kong 5,754,978 4,436,415
1,708,136,899 1,740,417,668
Total non-current assets other than financial assets
and deferred tax assets 31 December 2011 31 December 2010
Mainland PRC 5,725,768,655 5,068,071,718
Hong Kong 45,432 28,263
5,725,814,087 5,068,099,981
The revenue from Load and unload operation segment of RMB 731,545,867 is derived from a
single customer, accounting for 43% of the Group’s total revenue.
7 Related parties and related party transactions
(1) The parent company
(a) General information of the parent company
Entity type Place of Legal Nature of business Organisation
registration representative code
Nanshan Group Sino-foreign Shenzhen Fu Yuning Land development, port service and 61883297-6
invested enterprise transportation, industry and commerce,
tour, real estate and others
China Merchants (Nanshan) Holdings Ltd (an indirect subsidy of China Merchants Group Co.,
Ltd)，Shenzhen Investment Holdings Co.ltd and Guangdong Guangye Investment Holdings Ltd
holds 36.52%，26.1% and 23.49% share of Nanshan Group respectively, there is no other
shareholders’ share over 10%.
- 95 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Con’d)
(1) The parent company (Con’d)
(b) Registered capital and changes in registered capital of the parent company
31 December Current year Current year 31 December
2010 additions decreases 2011
Nanshan Group 500,000,000 400,000,000 - 900,000,000
(c) The proportion of interests and voting rights in the Company held by the parent company
31 December 2011 31 December 2010
% interest held % voting rights % interest held % voting rights
Nanshan Group 57.52% 57.52% 57.51% 57.51%
(2) Subsidiaries
The general background and other related information of the subsidiaries is set out in Note 4.
(3) Associates
Legal Voting
Place of representat Nature of Registered Interest right Organisation
Entity type incorporation ive business capital held held code
Joint venture –
China Overseas Harbour Affairs Sino-foreign Shandong, Li Chuan Harbour USD176,407.7 40% 40% 61344937-X
(Laizhou)Co.,Ltd invested China service thousand
enterprise
Associates –
China Merchants Holdings Sino-foreign Shenzhen, Luo Huilai Network 50 million 23.16% 23.16% 73207614-X
(international ) Information invested China service
Technology Co.,Ltd(Previous enterprise
name：Shenzhen Cyber-Harbour
Network Co Ltd)
CMML Sino-foreign Shenzhen, Hu Jianhua Warehousi 700 million 40% 40% 75045115-0
invested China ng service
enterprise
MPIL Overseas British Not Investment USD10 50% 50% Not applicable
enterprise Virgin Islands applicable
- 96 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Con’d)
(4) Other related parties
Relationship with the Group Organisation
code
CPSB Controlled by the same parent company 61883389-9
Xuqin Controlled by the same parent company 70845749-5
COCL Controlled by the same parent company 72616516-2
Shenzhen Nanshan Real Estate development Controlled by the same parent company
Ltd.(Nanshan Development) 75046859-3
Haiqin Engineering Common key connected person with the Company 61888000-1
Shenzhen Mawan Port Co., Ltd. (“SMP”) Indirect associates of the Company, and common 74322579-6
key management personnel with the Company
Shenzhen Mawan Wharf Co, Ltd.(“SMW”) Indirect associates of the Company, and common 74322582-5
key management personnel with the Company
Shenzhen Mawan Wharf Holdings Ltd Indirect associates of the Company, and common
key management personnel with the Company 74322581-7
MPIL Indirect associate of the Company Not applicable
Nantian Oilmills Common key connected person with the Company 61881614-0
CMML Associate of the Company 75045115-0
Shenzhen Southsea Grains Industries Limited Common key connected person with the Company
(“Southsea Grains”) 61883769-7
China Merchants Port Services (Shenzhen) Co Ltd
(“CMPS”) Note 19244179-0
Shekou Container Terminals Limited (“SCT”) Note 61883279X
China Merchants International Cold Chain Note
(Shenzhen) Company Limited (“CMCCL”) 61889222-3
Shenzhen Haixing Harbor Development Note
Co.,Ltd(“Haixing”)
China Merchant Bank Ltd(CMB) Note 10001686-X
COHA(Laizhou) Joint venture of the company 61344937-X
Excel Steps Limited Note Not applicable
Note: As at 30 June 2011, one of the Company’s parent company Nanshan Group’s indirect share
holder China Merchants Group Co., Ltd(which belongs to State-owned Assets Supervision and
Administration Commission of the State Council) via the arrangement of another share holder
Guangdong Guangye Investment Holdings ltd, obtained 23.49% share of Nanshan Group it holds
under trust, brought the Nanshan Group into the scope of the consolidation. These companies are
all subsidiaries of China Merchants Group Co., Ltd except China Merchants Bank which is an
associate of it.
- 97 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Con’d)
(5) Related party transactions
Saved for disclosed in above, other major related party transactions are as follows:
(a) Sale and purchase of goods, and rendering and receiving of services
Purchase of goods and receiving of services
Pricing Policies 2011 2010
and Amount % of same Amount % of same
determination transaction transaction
Related party Type of transaction Nature of transaction procedures
Haixing Service received Load and unload service Negotiation 2,609,695 0.27% - -
Haiqin Engineering Service received Project management Negotiation 1,701,180 13.31% - -
SCT Service received Load and unload service Negotiation 1,647,178 0.29% 637,445 0.10%
Nantian Oilmills Service received Load and unload service Negotiation 468,862 0.05% 2,883,502 0.33%
Xuqin Service received Construction Negotiation 457,830 0.05% 485,795 0.06%
Sale of goods and rendering of services
Pricing Policies 2011 2010
and Amount % of same Amount % of same
determination transaction transaction
Related party Type of transaction Nature of transaction procedures
Nantian Oilmills Service provided Load and unload service Negotiation 14,116,894 0.77% 11,517,735 0.64%
SMP Service provided Land Transportation and Negotiation 12,477,379 21.12% 13,461,672 20.12%
others
SMW Service provided Land Transportation and Negotiation 4,391,167 7.43% 5,650,795 8.44%
others
CMML Service provided Land Transportation and Negotiation 3,280,154 5.55% 2,086,335 3.12%
others
CPSB Service provided Load and unload service Negotiation 1,310,041 0.07% 720,457 0.04%
Southsea grains Service provided Load and unload service Negotiation 1,257,023 0.07% 1,965,821 0.11%
SCT Service provided Land Transportation and Negotiation 858,000 1.45% 911,920 1.36%
others
- 98 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Con’d)
(5) Related party transactions (Con’d)
(b) Lease
The Group as the leaser:
Lease income Lease
Lessor Lessee Leased assets Start date Ending date recognition basis income
CCT Southsea Grains Office land January 2011 December 2011 Negotiation 4,265,380
CCT CMML Crane May 2006 Not applicable Negotiation 2,240,000
The Company CPSB Land and packing January 2011 December 2011 Negotiation 9,474,036
yards
The Company Haiqin Engineering Building January 2011 December 2010 Negotiation 203,280
16,182,696
The Group as the lessee:
Leased assets Lease expenses Lease
Lessor Lessee Start date Ending date recognition basis expenses
Nanshan Entities of the Land, Office and Various N Various Negotiation 36,631,359
Development Group others
Nanshan Group Entities of the Land, buildings Various Respective Negotiation 5,284,157
Group and packing yards expiry of
operation of the
group
companies
Nantian Oilmills CGCL Packing yards January 2011 December 2011 Negotiation 2,155,137
CMPS CCT Packing yards January 2011 December 2011 Negotiation 2,400,000
CPSB The Company Land and buildings January 2011 December 2011 Negotiation 1,708,026
48,178,679
(c) Purchase of equity in an associate
As at 28 April 2011, Excel Steps Limited, WHK, a wholly owned subsidiary of the Company and the
company signed an agreement of transfer in shareholding. WHK paid to Excel Steps Limited RMB
6,270,000 to obtain 100% shareholdings of Hiwin Development Co.,Ltd,and undertook advances
from shareholder of Excel Steps Limited amounting RMB94,000,000.
- 99 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Con’d)
(5) Related party transactions (Con’d)
(d) Emoluments of key management
2011 2010
Emoluments of key management 9,389,000 5,338,436
(6) Receivables from and payables to related parties
Receivables from related parties：
31 December 2011 31 December 2010
Book amount Provision for Book amount Provision for
bad debt bad debt
Cash and bank China Merchants Bank 58,812,732 - 123,853,303 -
Accounts receivable Southsea Grains 1,368,092 - 110,521 -
SMP 682,266 - 998,942 -
COHA(Laizhou) 539,724 - - -
CMML 378,384 - 344,900 -
SMW 335,669 - 397,090 -
SCT 6,500 - 907,600 -
Nantian Oilmill - - 562,957 -
3,310,635 - 3,322,010 -
Other receivables
CMML 2,622,178 - 57,821 -
SMW 898,479 - 79,083 -
Xuqin 320,000 (192,000) 320,000 (192,000)
SMP 308,451 - 20,961 -
SCT 187,102 - -
CPSB 135,622 - 135,622 -
COCL(a) 48,645 - -
MPIL - - 44,879,120 -
4,520,477 (192,000) 45,492,607 (192,000)
- 100 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Con’d)
(6) Receivables from and payables to related parties (Con’d)
Payables to related parties：
31 December 2011 31 December 2010
Short tem borrowings China Merchants Bank 137,700,000 50,000,000
Accounts payable Haiqin Engineering 5,062,227 9,972,227
Nanshan Group (a) 5,002,068 8,583,552
Xuqin 319,058 1,760,479
Nantian Oilmill 163,201 202,361
CMIT 1,302,441 -
11,848,995 20,518,619
Other payables SMW(b) 945,521 2,961,451
CMCCCL 64,200 253,800
COCL(c) - 110,881
SMP(b) 31,963 20,894
Nanshan Group - 48,304
CMBL 2,001,792 49,540
3,043,476 3,444,870
(a) This item mainly includes the balance which Nanshan group collects electricity fees from the group
and pays to power supply bureau at almost the same price. In 2010,Nanshan Group also paid the
emolument of key management on behalf of the company, and charged the company for it.
(b) The Company cooperates with Mawan companies in marketing promotion activities. Some
common expenses incurred in the cooperation are allocated to both parties based on certain
reasonable criteria. For those payments and receipts made on behalf, the Company and Mawan
companies recorded the amounts in other receivables or other payables.
(c) COCL was a subsidiary of the Company and sold to Nanshan Group in 2009, after which it became
a related party of the Company. The current account balances represented those unsettled amount
relating to relevant business at the disposal of COCL at 31 December 2010.
- 101 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
7 Related parties and related party transactions (Con’d)
(7) Commitments in relation to the related parties
31 December 2011 31 December 2010
Rental
- Rental expense CPSB 1,812,018 1,713,566
CMPS 2,400,000 -
Nanshan Group 2,765,466 3,083,751
6,977,484 4,797,317
- Rental income
CPSB 11,740,000 10,819,640
Southsea Grains 4,265,380 4,265,856
Haiqin engineering - 348,480
16,005,380 15,433,976
8 Contingencies
As at 31 December 2011, the management of the group has assessed all pending lawsuits or
claims and believes that none of them will cause significant outflow of economic benefits of the
group.
9 Commitments
(1) Capital commitments
Capital expenditures contracted for by the Group at the balance sheet date but not yet necessary
to be recognised on the balance sheet are as follows:
31 December 2011 31 December 2010
Land and coastal line use rights 109,874,895 168,291,373
Machinery and equipments 83,887,000 33,050,780
Harbour facilities 250,404,509 159,405,361
444,166,404 360,747,514
The Group’s share of the joint ventures’ own commitments for capital expenditure at the balance
sheet date are RMB 176,966,411.
- 102 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
9 Commitments (Con’d)
(2) Operating lease commitments
The future aggregate minimum lease payments due under the signed irrevocable operating leases
contracts are summarized as follows:
31 December 2011 31 December 2010
Within one year 7,966,481 5,614,470
Between 1 and 2 years 830,341 1,607,499
Between 2 and 3 years 830,341 830,341
More than 3 years 2,281,452 3,111,783
11,908,615 11,164,093
(3) Fulfillment of prior period commitments
The Group has fulfilled the capital and operating lease commitments as of 31 December 2010
according to the relevant contracts.
10 Events after the balance sheet date
(1) Significant events after balance sheet date
Impact to the financial
position and the financial Reason of the impact
Item Nature performance could not be estimated
Repayment of the accounts payable Repayment of the Decreased both asset and
(Note5(23)(c)) significant accounts liabilities of
payable with the RMB18,713,587
aging over 1 year -
(2) Dividend distribution after the balance sheet date
Amount
Proposed dividends 257,905,492
Pursuant to the resolution of Board at the Board of Directors’ meeting on 27 March 2012, cash
dividends in respect of 2011 of RMB 257,905,492. The proposed dividend is not recognised as
liability in balance sheet.
- 103 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
10 Events after the balance sheet date (Con’d)
(3) Illustration on the issue of bonds after the balance date
As set out in the announcement of resolution in the seventh board of directors’ third special
meeting in year 2011, the board of directors adopted Report about the proposal on the issue of
corporate bond, the total amount of corporate bond will not exceed RMB 120millons (including 120
millions),with no more than 10 years(including 10 years) expiration period. At 28 November
2011,the company received the Rescriptum on the approval of public issue of corporate bond of
Shenzhen Chiwan Wharf Limited Co.,Ltd, and is approved to issue corporate bond publicly with no
more than 100 million in par value. The issue of the corporate bond will be issued in several times
and the par value at the first issue should be no less than 50% of the total par value and it will be
accomplished within 6 months after approval. The issues in other times should be completed within
24 months after approval. The rescriptum is effective in 24 months after the date of approval(24
November 2011).
11 Financial instrument and risk
The Group's activities expose it to a variety of financial risks: market risk (primarily currency risk
and interest rate risk), credit risk and liquidity risk. The Group's overall risk management
programme focuses on the unpredictability of financial markets and seeks to minimise potential
adverse effects on the Group's financial performance.
(1) Market risk
(a) Foreign exchange risk
The Group’s major operational activities are carried out in Mainland China and a majority of the
transactions are denominated in RMB. The Group is exposed to foreign exchange risk arising from
the recognized assets and liabilities, and future transactions denominated in foreign currencies
(recognized assets and liabilities are primarily with respect to Hong Kong dollars, foreign currency
transaction is mainly with respect of HK and US dollars). The Group’s finance department at its
headquarters is responsible for monitoring the amount of assets and liabilities, and transactions
denominated in foreign currencies.
According to current risk exposure and the trend of exchange rate fluctuation, management
believed that the risk caused by the fluctuation of foreign currency exchange rate is low in the
coming year.
- 104 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Con’d)
(1) Market risk (Con’d)
(a) Foreign exchange risk (Con’d)
As at 31 December 2011 and 2010, the carrying amounts in RMB equivalent of the Group’s assets
and liabilities denominated in foreign currencies are summarized below:
31 December 2011
HKD USD Total
Financial assets denominated in foreign currency -
Cash at bank and on hand 160,166,594 25,153,257 185,319,851
Receivables 1,064,631 31,409,683 32,474,314
161,231,225 56,562,940 217,794,165
Financial liabilities denominated in foreign currency -
Short-term borrowings 1,168,830,000 - 1,168,830,000
Payables 3,466,115 1,377,672 4,843,787
1,172,296,115 1,377,672 1,173,673,787
- 105 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Con’d)
(1) Market risk (Con’d)
(a) Foreign exchange risk (Con’d)
31 December 2010
HKD USD Total
Financial assets denominated in foreign currency -
Cash at bank and on hand 166,707,323 8,850,378 175,557,701
Receivables 2,803,651 27,480,595 30,284,246
169,510,974 36,330,973 205,841,947
Financial liabilities denominated in foreign currency -
Short-term borrowings 835,550,000 - 835,550,000
Payables 4,392,328 3,580,977 7,973,305
Long-term borrowings 408,000,000 - 408,000,000
1,247,942,328 3,580,977 1,251,523,305
As at 31 December 2011, if the currency had strengthened by 5 % against the HKD while all other
variables had been held constant, the Group’s net profit for the year would have been
approximately RMB37,914,933 (2010,10%: RMB87,034,038).
(b) Interest rate risk
The Group's interest rate risk arises from bank borrowings including long-term borrowings and
debentures payable. Financial liabilities issued at floating rates expose the Group to cash flow
interest rate risk. Financial liabilities issued at fixed rates expose the Group to fair value interest
rate risk. The Group determines the relative proportions of its fixed rate and floating rate contracts
depending on the prevailing market conditions. As at 31 December 2011, all the Group’s interest
bearing borrowings were with floating rates.
Increases in interest rates will increase the cost of new borrowing and the interest expenses with
respect to the Group’s outstanding floating rate borrowings, and therefore could have a material
adverse effect on the Group’s financial position. The Group’s finance department at its
headquarters continuously monitors the interest rate position of the Group and makes decisions
with reference to the latest market conditions including turning to fixed interest financial liabilities or
adjusting the ratio of financial leverage.
For the year ended 31 December 2011, if interest rates on the floating rate borrowings had been
5% higher/lower while all other variables had been held constant, the Group’s net profit would have
decreased/increased by approximately RMB 288,609 (2010: approximately RMB2,683,386).
- 106 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Con’d)
(4) Credit risk
Credit risk is managed on a Group basis. Credit risk mainly arises from cash at bank and on hand,
accounts receivable, other receivables, notes receivable etc.
The Group expects that there is no significant credit risk associated with cash at bank since they
are deposited at state-owned banks and other medium or large size listed banks. Management
does not expect that there will be any significant losses from non-performance by these
counterparties.
In addition, the Group has policies to limit the credit exposure on accounts receivable, other
receivables and notes receivable. The Group assesses the credit quality of and sets credit limits on
its customers by taking into account their financial position, the availability of guarantee from third
parties, their credit history and other factors such as current market conditions. The credit history of
the customers is regularly monitored by the Group. In respect of customers with a poor credit
history, the Group will use written payment reminders, or shorten or cancel credit periods, to
ensure the overall credit risk of the Group is limited to a controllable extent.
(5) Liquidity risk
Cash flow forecasting is performed by each subsidiary of the Group and aggregated by the Group’s
finance department in its headquarters. The Group’s finance department at its headquarters
monitors rolling forecasts of the Group's short-term and long-term liquidity requirements to ensure it
has sufficient cash and securities that are readily convertible to cash to meet operational needs,
while maintaining sufficient headroom on its undrawn committed borrowing facilities from major
financial institution so that the Group does not breach borrowing limits or covenants on any of its
borrowing facilities to meet the short-term and long-term liquidity requirements.
The financial assets and liabilities of the Group at the balance sheet date are analysed by their
maturity date below at their undiscounted contractual cash flows :
- 107 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Con’d)
(3) Liquidity risk (Con’d)
31 December 2011
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
Financial assets denominated in
foreign currency -
Cash at bank and on hand 478,788,943 - - - 478,788,943
Receivables 242,930,624 - - - 242,930,624
Available-for-sale financial assets 5,690,000 - - - 5,690,000
727,409,567 - - - 727,409,567
Financial liabilities denominated in
foreign currency -
Short-term borrowings 1,418,830,000 - - - 1,418,830,000
Payables 581,353,690 - - - 581,353,690
Long-term borrowings 90,000,000 4,084,989 4,376,774 - 98,461,763
2,090,183,690 4,084,989 4,376,774 - 2,098,645,453
31 December 2010
Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
Financial assets denominated in
foreign currency -
Cash at bank and on hand 781,720,083 - - - 781,720,083
Receivables 238,496,318 - - - 238,496,318
Available-for-sale financial assets 6,640,000 - - - 6,640,000
1,026,856,401 - - - 1,026,856,401
Financial liabilities denominated in
foreign currency -
Short-term borrowings 1,225,550,000 - - - 1,225,550,000
Payables 507,567,419 - - - 507,567,419
Long-term borrowings 408,000,000 - - - 408,000,000
2,141,117,419 - - - 2,141,117,419
- 108 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Con’d)
(3) Liquidity risk (Con’d)
The borrowings of the group are mainly short term bank loans and therefore the net current liability
of the group was RMB 1,453,506,937 at 31 December 2011.
As at 31 December 2011, the internal undrawn bank facilities of the group are listed as below :
Within a year 2,777,520,100
1 to 2 years 413,700,000
2 to 3 years 100,000,000
Over 3 years 100,000,000
3,391,220,100
Undrawn facilities above can be used on the committed capital payment in the future (Notes 9).
Directors of the company confirmed that the group is able to extend the time limits of short term
borrowings and adequate facilities including facilities over a year and other financing resources to
refund existed short term borrowings, and adequate working capital for the need of operation.
Therefore the 2011 financial statements have been prepared on going concern basis by directors.
(4) Fair value
(a) Financial instruments not measured at fair value
Financial assets and liabilities not measured at fair value mainly represent receivables, short-term
borrowings, payables and Long-term borrowings.
The difference between the book value and fair value of the financial assets and liabilities not
measured at fair value is immaterial.
The fair value of long-term borrowings not quoted in an active market is the present value of the
contractually determined stream of future cash flows discounted at the rate of interest applied at
that time by the market to instruments of comparable credit status and providing substantially the
same cash flows on the same terms.
- 109 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
11 Financial instrument and risk (Con’d)
(b) Financial instruments measured at fair value
Based on the lowest level input that is significant to the fair value measurement in its entirety, the
fair value hierarchy has the following levels:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or
liability, either directly (that is, as prices) or indirectly (that is, derived from prices).
Level 3: Inputs for the asset or liability that are not based on observable market data (that is,
unobservable inputs)
As at 31 December 2011 and 31 December 2010, the financial assets of the Group are all
measured at Level 1.
31 December 2011 31 December 2010
Financial assets -
Available- for- sale financial assets 5,690,000 6,640,000
12 Financial assets and liabilities denominated in foreign currency
Impairment
Current year fair Current year fair provision
31 December value changes in value changes in made during the 31 December
2010 profit or loss equity year 2011
Financial assets -
Available-for-sale financial assets 6,640,000 - (950,000) - 5,690,000
13 Financial assets and liabilities denominated in foreign currency
Impairment
provided
31 December 2010 during the year 31 December 2011
Financial assets -
Loans and receivables 205,841,947 - 217,794,165
Financial liabilities 1,251,523,305 Not applicable 1,173,673,787
- 110 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements
(1) Accounts receivable
31 December 2011 31 December 2010
Accounts receivable 16,623,725 9,336,968
(a) The ageing of accounts receivable is analysed below:
31 December 2011 31 December 2010
Within 1 year 16,623,725 9,336,968
(b) Accounts receivable are analysed by categories as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of total Provision for % of % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
Receivables that are individually
significant and individually
provided for bad debt 12,930,685 78% - - 6,608,924 70.8% - -
Receivables that are grouped
and provided for bad debt 3,693,040 22% - - 2,728,044 29.2% - -
16,623,725 100% - - 9,336,968 100% - -
The management classified the five largest accounts receivable as “receivables that are
individually significant”. They are all aged within one year and the management considered no
provision for bad debts is needed.
(c) As at 31 December 2011, no bad debt provision has been made for accounts receivable that are
individually significant or individually insignificant but subject to separate impairment assessment.
(d) The aging analysis of the receivables that are grouped and impaired is as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of total Provision for % of % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
Within 1 year 3,693,040 22.2% 2,728,044 29.2% - -
- 111 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(1) Accounts receivable (Con’d)
(e) There are no receivables which are fully provided for bad debt or with significant impairment but
fully received or recoverable or with significant portion of received or recoverable during the year.
(f) No accounts receivable have been written off during the year.
(g) As at 31 December 2011, no balances included in above accounts receivable are due from the
shareholders of the Company who hold over 5% shares with voting rights (31 December 2010: Nil).
(h) As at 31 December 2011, the Group’s five largest accounts receivable balances are analysed as
follows:
Relationship % of total accounts
with the Group Amount Duration receivable balance
Customer F Third party 3,569,319 Within 1 year 21.47%
Customer G Third party 3,398,212 Within 1 year 20.44%
Customer H Third party 3,324,392 Within 1 year 20.00%
Customer I Third party 1,398,412 Within 1 year 8.41%
Customer J Third party 1,240,350 Within 1 year 7.46%
12,930,685 77.78%
(i) As at 31 December 2011, there were no balances due from related parties (31 December 2010:
Nil).
- 112 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(2) Other receivables
31 December 2011 31 December 2010
Loans to subsidiaries 239,270,156 364,704,313
Others 4,128,109 1,780,950
243,398,265 366,485,263
Less: Provision for bad debts (141,728) (623,127)
243,256,537 365,862,136
(a) The ageing of other receivables is analysed below:
31 December 2011 31 December 2010
Within 1 year 242,395,966 364,164,485
1 to 2 years 486,070 150
2 to 3 years 150 108,221
Over 3 years 516,079 2,212,407
243,398,265 366,485,263
(b) Other receivables are analysed by categories as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of total Provision for % of % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
Receivables that are individually
significant and individually
provided for bad debt 241,923,908 99.39% - - 365,224,313 99.66% (520,000) 0.14%
Receivables that are grouped and
provided for bad debt 1,474,357 0.61% (141,728) 9.61% 1,260,950 0.34% (103,127) 8.18%
243,398,265 100% (141,728) 0.06% 366,485,263 100% (623,127) 0.17%
The management classified the five largest accounts receivable as “receivables that are
individually significant”.
- 113 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(2) Other receivables (Con’d)
(c) The aging analysis for other receivables that are grouped and provided for bad debt is as follows:
31 December 2011 31 December 2010
Book amount Provision for bad debts Book amount Provision for bad debts
% of total Provision for % of % of total Provision for % of
Amount balance bad debts balance Amount balance bad debts balance
Within 1 year 855,515 0.35% - - - - - -
1 to 2 years 486,070 0.20% (762) 0.16% 150 0.00% (15) 10.0%
2 to 3 years 150 0.00% (30) 20.00% 108,221 0.03% (21,644) 20.0%
Over 3 years 132,622 0.05% (102,590) 77.36% 1,152,579 0.31% (81,468) 7.1%
1,474,357 0.60% (103,382) 7.01% 1,260,950 0.34% (103,127) 8.2%
(d) There are no receivables which are fully provided for bad debt or with significant impairment but
fully received or recoverable or with significant portion of received or recoverable during the year.
(e) Other receivables were written off during the year:
At 31 December 2010, Receivables that are individually significant and individually provided for bad
debt are analysed below:
Book value Bad debt Provision rate
Beijing Tonggang Co 520,000 (520,000) 100%
Reason for written-off: at 31 December 2011, the other receivable is over 3 years and this
company has bankrupted, so this other receivable was written off.
(f) As at 31 December 2011, the Company did not have any balances which were due to parties
having 5% or above shareholdings in the Company (31 December 2010: Nil).
- 114 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(2) Other receivables (Con’d)
(g) At 31 December 2011, the Company’s five largest other receivable balances are analysed below:
% of total other
Relationship with the Group Amount Duration receivables balance
DGW Subsidiary of the Group 206,000,000 Within 1 year 84.6%
CSTC Subsidiary of the Company 32,210,156 Within 1 year 13.2%
WHK Subsidiary of the Company 2,270,295 Within 1 year 0.9%
CIFA Subsidiary of the Company 1,060,000 Within 1 year 0.4%
Enterprise income tax payable for
dividend of B share in 2008 Shareholders of the group 383,457 1 to 2 years 0.2%
241,923,908 99.4%
(h) Other receivables due from related parties are analysed as follows:
31 December 2011 31 December 2010
% of total Provision % of total Provision
Relationship accounts for bad accounts for bad
with the Group Amount receivables debt Amount receivables debt
DGW Subsidiary of the Group 206,000,000 84.63% - 325,800,000 88.90% -
CSTC Subsidiary of the Company 32,210,156 13.23% - 36,363,777 9.92% -
WHK Subsidiary of the Company 2,270,295 0.93% - 1,480,536 0.40% -
CIFA Subsidiary of the Company 1,060,000 0.44% - 1,060,000 0.29% -
Controlled by the same parent
CPSB company 135,622 0.06% - 135,622 0.04% -
241,676,073 99.29% - 364,839,935 99.55% -
(3) Long-term equity investments
31 December 2011 31 December 2010
Subsidiaries (a) 1,052,288,200 733,088,200
Joint venture(b) 795,776,215 763,011,159
Associates (c)- without quoted price 140,142,959 79,636,013
Other long-term equity investments (d) 17,037,500 17,037,500
2,005,244,874 1,592,772,872
Less: provision for impairment loss (e) (3,128,300) (3,128,300)
2,002,116,574 1,589,644,572
The long-term equity investments of the Company are not subject to restriction on conversion into
cash.
- 115 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(3) Long-term equity investments (Con’d)
(a) Subsidiaries
Provision
Reason of Provision for
31 inconsistent for impairment
Accounting Investment December Current year 31 December Interest Voting interest % and impairment made in Current year
method costs 2010 changes 2011 % right % voting right balance current year declared cash dividend
Shenzhen Chiwan Terminal Company Limited Cost method 47,500,000 47,500,000 - 47,500,000 95% 95% Not applicable - - 39,338,688
Shenzhen Chiwan International Freight
Agency Company Limited Cost method 5,500,000 5,500,000 - 5,500,000 100% 100% Not applicable - - 1,165,548
Shenzhen Chiwan Harbour Container
Company Limited Cost method 250,920,000 70,920,000 180,000,000 250,920,000 84.98% 84.98% Not applicable - - 140,826,505
Shenzhen Chiwan Transportation Company
Limited Cost method 7,000,000 7,000,000 - 7,000,000 75% 75% Not applicable - - 6,757,560
Chiwan Wharf Holdings (H.K.) Limited Cost method 1,070,000 1,070,000 - 1,070,000 100% 100% Not applicable - - -
Shenzhen Chiwan Shipping and
Transportation Company Limited Cost method 24,000,000 6,000,000 18,000,000 24,000,000 90% 90% Not applicable - - 20,533,063
Shenzhen Chiwan Trains-Grains Terminal
Company Limited Cost method 33,750,000 33,750,000 - 33,750,000 75% 75% Not applicable - - 20,616,286
Chiwan Container Terminal Company Limited Cost method 421,023,200 421,023,200 - 421,023,200 51% 51% Not applicable - - 185,445,049
Dongguan Chiwan Wharf Company Limited Cost method 186,525,000 65,325,000 121,200,000 186,525,000 41.45% 41.45% Not applicable - - -
Dongguan Chiwan Terminal Company Limited Cost method 75,000,000 75,000,000 - 75,000,000 25% 25% Not applicable - - -
733,088,200 319,200,000 1,052,288,200 - - 414,682,699
- 116 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(3) Long-term equity investments (Con’d)
(b) Joint venture
Current year additions / decreases
Reason of Provision Provision
Initial Share of net Cash dividends Other inconsistent for for impairment
Accounting investment 31 December Additional profit or loss of announced by equity 31 December Interest Voting interest % and impairment made in
method cos 2010 investment associates associates changes 2011 % right % voting right balance current year
China Overseas Harbour
Affairs(Laizhou)Co.,Ltd Equity method 749,655,300 763,011,159 - 32,665,056 - 100,000 795,776,215 40.00% 40.00% Not applicable - -
(c) Associates
Current year additions / decreases
Cash Reason of Provision Provision
Initial 31 Share of net dividends Other inconsistent for for impairment
Accounting investment December Additional profit or loss announced by equity 31 December Interest Voting interest % and impairment made in
method cost 2010 investment of associates associates changes 2011 % right % voting right balance current year
Cyber Network Equity method 1,875,000 12,869,241 - 19,885 (1,224,863) - 11,664,263 23.16% 23.16% Not applicable - -
CMML Equity method 140,000,000 66,766,772 60,000,000 1,711,924 - - 128,478,696 20.00% 20.00% Not applicable - -
79,636,013 60,000,000 1,731,809 (1,224,863) - 140,142,959 - -
- 117 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(d) Other long-term equity investment
Reason of Provision for
Initial Current year inconsistent Provision for impairment Current year
Accounting investment 31 December additions / 31 December Interest Voting interest % and impairment made in declared cash
method cost 2010 decreases 2011 % right % voting right balance current year dividend
China Ocean Shipping Agency
(Shenzhen) Company Limited Cost method 13,510,000 13,510,000 - 13,510,000 15% 15% Not applicable - - 3,900,000
Shenzhen Petro-chemical Industry -
(Group) Company Limited. Cost method 3,500,000 3,500,000 - 3,500,000 0.26% 0.26% Not applicable (3,117,800) -
Guangdong Guang Jian Group - -
Company Limited Cost method 27,500 27,500 27,500 0.02% 0.02% Not applicable (10,500) -
17,037,500 - 17,037,500 (3,128,300) - 3,900,000
(e) Provision for impairment of long-term equity investments
31 December 2010 Current year additions Current year decreases 31 December 2011
Other long-term equity investment
-Shenzhen Petro-chemical Industry (Group) Company Limited 3,117,800 - - 3,117,800
-Guangdong Guang Jian Group Company Limited 10,500 - - 10,500
3,128,300 - - 3,128,300
- 118 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(4) Operating income and operating cost
2011 2010
Revenue from main operations 165,422,103 149,806,838
Revenue from other operations 23,700,419 10,184,257
189,122,522 159,991,095
2011 2010
Cost from main operations 134,885,611 133,144,267
Cost from other operations 1,590,313 950,546
136,475,924 134,094,813
(a) Revenue and cost from main operations
2011 2010
Revenue from Cost from main Revenue from Cost from main
main operations operations main operations operations
Load and unload operation 165,422,103 134,885,611 149,806,838 133,144,267
The mainly operation are in mainland of PRC.
(b) Other revenue and cost
2011 2010
Revenue from Cost from Revenue from Cost from
other operations other operations other operations other operations
Other logistic services in port 7,367,988 - 4,558,967 99,430
Lease income 14,733,909 1,590,313 4,213,916 851,116
Documentation fee 611,802 - 802,864 -
Sales of materials 929,306 - 479,583 -
Security fee 57,414 - 87,677 -
Containers management fee - - 41,250 -
23,700,419 1,590,313 10,184,257 950,546
- 119 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(4) Operating income and operating cost (Con’d)
(c) Particulars of the top five customers in revenue
Revenue from top five customers of the Company totaled RMB87,317,723 (2010: RMB73,600,944),
which accounted for 46% (2010: 46%) of the total revenue from main operations. Details are
showed as below:
% of total revenue
from main operations
Revenue of the Company
Customer K 37,649,494 20%
Customer F 27,025,168 14%
Customer L 10,084,805 5%
Customer G 6,855,726 4%
Customer H 5,702,530 3%
87,317,723 46%
(5) Investment income
2011 2010
Income from long-term equity investment under
cost method(a) 418,582,699 351,413,618
Income from long-term equity investment under
equity method (b) 34,396,865 13,161,967
Income from disposal of long-term equity
investment - 29,767,257
Income earned during the holding period of
available-for-sale financial assets 360,000 310,000
Interest income for short-term loans to subsidiaries 14,681,787 12,478,236
468,021,351 407,131,078
There is no restriction on recovery of investment income.
- 120 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(5) Investment income (Con’d)
(a) Investment income from long-term investment under cost method
Investment income from top five investees or individually accounted to over 5% of total profit are
analysed as below:
2011 2010 Reason of fluctuation
CCT 185,445,049 260,620,436 Performance of investee declined
CHCC 140,826,505 - Investee distributes profit of last two years and shareholding
increased.
CTC 39,338,688 37,886,083 Performance of investee turns better slightly
CGTC 20,616,286 24,479,423 Performance of investee declined
CSTC 20,533,063 16,748,145 Shareholding increased.
CTC 6,757,560 10,380,293 Performance of investee declined
413,517,151 350,114,380
(b) Investment income from long-term investment under equity method of accounting
Investment income from top five investees or individually accounted to over 5% of total profit are
analysed as below:
2011 2010 Reason of fluctuation
COHA(Laizhou) 32,665,056 13,355,859 Investee is the newly joint venture last year and investment
income is the portion of net profit
Cyber Network 19,885 379,477 Investee decline in performance and the Group
decreased the interest
CMBL 1,711,924 (573,369) Investee run into operation and its circumstance turns
better
34,396,865 13,161,967
- 121 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
14 Notes to the Company’s financial statements (Con’d)
(6) Supplementary information to cash flow statements
(a) Reconciliation from the net profit to the cash flows from operating activities
2011 2010
Net profit 430,118,631 381,220,010
Add: Provisions for assets impairment 38,601 24,478
Depreciation of fixed assets 12,283,329 15,396,195
Depreciation/amortisation of investment
property 1,077,281 650,756
Amortisation of intangible assets 3,139,405 3,038,583
Amortisation of long-term prepaid expenses 179,620 247,891
Gains on disposal of fixed assets and
intangible assets 1,394,937 233,184
Finance expenses 17,883,502 11,929,443
Investment income (468,021,352) (407,131,078)
Increase in deferred tax assets (8,488,104) (764,157)
(Increase)/decrease in inventories 176,247 (4,287)
(Increase)/decrease in operating receivables 115,970,883 (6,070,788)
Increase in operating payables 191,891,312 284,808,825
Net cash flows from operating activities 297,644,292 283,579,055
(b) Net changes in cash and cash equivalents
2011 2010
Cash at end of year 187,090,694 494,364,355
Less: cash at beginning of year (494,364,355) (453,407,958)
Net (decrease)/increase in cash (307,273,661) 40,956,397
- 122 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
SUPPLEMENTARY INFORMATION TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
1 Breakdown of extraordinary gains and losses
2011 2010
Net gain on disposal of non-current assets (1,889,222) (672,955)
Government grants in current year profit - 1,200,000
Receivables impairment reversal by individual
assessment - -
Other non-operating (expenses)/income, net 1,731,897 1,448,435
(157,325) 1,975,480
cts 33,863 (350,605)
Minority interests effects (after tax) 138,789 (255,118)
15,327 1,369,757
The basis of preparation of net profit before extraordinary gains and losses reconciliation
According to the Interpretation Bulletin on Information Disclosure by Public Companies No [2008] 1
– Extraordinary gains and losses, extraordinary gain and losses are the gain and losses resulted
from the transactions/events which are not incurred by the operation of the entity, or, though
incurred by the operation, the nature, amounts or the frequency of such transactions/events will
lead to a misleading presentation of the normal performance and profitability of the operation of the
entity.
2 Return on equity and earnings per share
Weighted average return Earnings per share
on equity (%) Basic earnings per share Diluted earnings per share
2011 2010 2011 2010 2011 2010
Consolidated net profit attributable to
shareholders of the Company 15.19% 19.70% 0.784 0.925 0.784 0.925
Consolidated net profit excluding non-
routine items attributable to
shareholders of the Company 15.19% 19.65% 0.784 0.923 0.784 0.923
- 123 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
SUPPLEMENTARY INFORMATION TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
3 Notes for significant fluctuation of major accounts in financial statements
The following represents analysis to financial statements line items with a fluctuation above 30%
(inclusive), or take up 5% of total assets as at balance sheet date (inclusive) or 10% of net profit for
the reported period (inclusive):
31 December 31 December Increase /
2011 2010 (decrease)(%)
Cash at bank and on hand 1 478,788,943 781,720,083 -39%
Notes receivable 2 - 4,640,000 -100%
Advances to suppliers 3 3,497,668 31,256,172 -89%
Interest receivable 4 51,667 1,318,202 -96%
Other receivables 5 11,833,877 52,765,361 -78%
Other current assets 6 1,003,913 -
Long-term equity investments 7 1,436,856,420 1,149,921,886 25%
Fixed assets 8 2,482,077,688 2,652,957,915 -6%
Construction in progress 9 517,818,144 14,593,516 3448%
Intangible assets 10 1,038,926,892 1,074,247,819 -3%
Other non-current assets 11 142,108,284 72,292,214 97%
Short-term borrowings 12 1,418,830,000 1,225,550,000 16%
Notes payable 13 8,704,900 1,895,750 359%
Employee benefits payable 14 55,945,867 36,929,912 51%
Interests payable 15 1,637,790 2,958,406 -45%
Dividends payable 16 365,161,451 213,351,043 71%
Current portion of non-current
17 -96%
liabilities 14,951,750 412,951,750
Long-term borrowings 18 90,000,000 -
Year 2011 Year 2010
Revenue 19 1,708,136,899 1,740,417,668 -2%
Cost of sales 20 (768,040,243) (742,312,284) 3%
General and administrative
21%
expenses 21 (158,186,232) (130,781,048)
Financial (expenses)/income 22 (12,370,981) 10,535,505 -217%
Asset impairment
111%
reversals/(losses) 23 (251,074) (119,061)
Investment income 24 118,228,183 148,514,648 -20%
Non-operating income 25 1,878,537 5,012,970 -63%
Non-operating expenses 26 (2,035,862) (3,037,490) -33%
Income tax (expenses)/ income 27 (148,561,633) (137,775,617) 8%
- 124 -
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
SUPPLEMENTARY INFORMATION TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
(All amounts in RMB unless otherwise stated)
[English translation for reference only]
3 Notes for significant fluctuation of major accounts in financial statements(Con’d)
(1) Increased investments and payment for project leads to the decrease in balance of cash at
bank and on hand.
(2) As at 31 December 2011, no balance on notes receivable.
(3) Berth 4#-5#, Machong Port project of DGW started in 2011, and prepayment for projects
converts into construction in progress, which results in the decline of advance to suppliers.
(4) A great fixed deposit in 31 December 2011 turns into current deposit in 2011 to pay for land
and project and this generated the drop in interest receivable.
(5) It is mainly due to the withdrawal of investment in joint venture,MPIL(Note 5(9)).
(6) This item is the premium of prepayment for income tax by quarter over annual tax payable,
and in accordance with stipulation, it should be shown in other current assets.(2010:Nil)
(7) The group indirectly bought in 20% shareholding of CMBL, by buying 100% shareholdings of
Hinwin,and increased investment in CMBL.Meanwhile, movement of investee’s net assets
under equity method also leads to the balance of long-term equity investment.
(8) The fall in net value of property, plant and equipment is mainly due to depreciation
accrual ,turning into investment properties and the adjustment after final settlement in
subsidiary etc.
(9) Extension of berth in subsidiary, tug construction and projects in Marchong port are
unfinished,which caused the remarkable increase in construction in progress.
(10) Intangible assets are mainly land and shore use right. Ordinary amortization contributes to the
decline in balance.
(11) Other non-current assets are mainly prepayment for land with no certificates in Machong
port ,advances for shore and prepayment for projects which are not yet commenced
(12) The slightly increase in short-tern loan is mainly due to the repayment of lots of long-term
borrowings,and the financing structure decreased.
(13) Notes payable is bank acceptance notes issued for settlement in daily operation.
(14) Year–end bonus and emoluments accrued in end of 2011 is higher than the same time of
2010.
(15) It is mainly due to the decrease of average financing structure.
(16) The balance is dividend payable to minority interest of CCT. At 31 December 2011, the
dividends of 2011 and 2010 are declared but not paid yet.
(17) The long-term borrowing is classified into current portion non-current liabilities according to
the contract and collection plan of bank
(18) It is mainly the long-term borrowing of DGW,and the group increase long-term borrowing to
optimize the financing structure.
(19) Macro- economic situation led to the shrink of import and export business and throughput of
port and the revenue declined accordingly.
(20) It is mainly due to the rise of employee cost and outsourced labor cost
(21) It is mainly due to the increase of employee cost, including the long-term incentive package.
(22) It is mainly due to the output of interest of borrowing in bank
(23) The accrual of provision for inventories with long age led to the increase in asset impairment
losses
(24) The decline in investment income is mainly due to the disposal of long-term equity investment
in 2010 and no such transaction in 2011.
(25) It is mainly due to the decline of income from disposal of non-current assets and no
government grants obtained in 2011.
(26) It is in line with the loss in disposal of non-current assets.
(27) Tax rates of almost subsidiaries arose from 22% to 24% and tax holiday of some berths
expired, which led to the increase of income tax expense.
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